Syncora's lawsuit against Macquarie Capital is another source of upside related to American Roads. The lawsuit claims that Macquarie arranged for a consultant to provide unrealistic traffic, revenue and earnings projections to Syncora so that the company would insure American Roads bonds. Syncora has accused Macquarie of working with the consultant to create inaccurate projections and concealing the nature of their relationship with the consultant.
So far, Syncora appears to have the upper hand in court. Macquarie's motions for dismissal have been swatted down, and the parties are currently in pretrial discovery. Discovery is expected to conclude in April, when the next phase will begin.
A toll road transaction is unlikely to occur until after this lawsuit is resolved because it could have a negative impact on the value of a settlement or ruling. Syncora incurred a loss of approximately $250M based on the current balance sheet, but a sale could show that the actual loss was much less. I believe that the parties could potentially settle for $100M, but the court could award Syncora over $200M if the case goes to trial. "