Download Consortium of lenders provides financing to Fraport Greece for the

March 27, 2017
Consortium of lenders provides financing to
Fraport Greece for the concession of 14 Greek
regional airports
EUR 968,4 million , in total long-term financing by ALPHA
BANK , BSTDB, EBRD, EIB and IFC
A consortium of leading financial institutions has signed a long-term
financing of approximately EUR 1 billion with Fraport Greece for the 40year concession of the 14 Greek regional airports. The consortium of
lenders includes: Alpha Bank (EUR 284,7m), Black Sea Trade and
Development Bank (EUR 62,5m) European Bank for Reconstruction and
Development (EUR 186,7 m), European Investment Bank (EUR 280,4 m),
and the International Finance Corporation (EUR 154,1 m), a member of the
World Bank Group. IFC is also is also the sole provider of Euro interest rate
hedging swaps to help Fraport Greece hedge potential fluctuations in interest
rates through the term of the loan.
EUR 280,4 million of the total loan will be used for the financing of development
works at the 14 airports, while EUR 688 million will be used as part of the
upfront concession payment (EUR 1,234 billion) to the Hellenic Republic
Assets Development Fund. Fraport Greece recently also announced a capital
increase raising the company’s total capital amounts at EUR 650 million.
Fraport Greece, a joint venture of Fraport AG Frankfurt Airport Services
Worldwide and Copelouzos Group, is paying a total of EUR 1,234 billion for
the concession to the Hellenic Republic Asset Development Fund. This
constitutes the biggest concession fee ever paid in the history of the
Hellenic Republic. Through this investment the two shareholders demonstrate
their willingness to support the country’s efforts to achieve recovery as well as
their trust in Greece’s potential. The agreement also includes the
modernization and upgrading of airport infrastructure. Fraport Greece will
invest at least EUR 400 million during the first four years in construction works
for the development of the airports that will support the development of the
tourism industry, a key driver of the Greek economy. During the period of the
entire concession, infrastructure investments will exceed EUR 1,4 billion.
The 14 airports included in the concession are Aktion, Chania (Crete),
Kavala, Kefalonia, Kerkyra (Corfu), Kos, Mitilini, Mykonos, Rhodes,
Samos, Santorini, Skiathos, Thessaloniki – Greece’s second largest city –
and Zakynthos. Combined, these airports served a total of about 25,2 million
passengers in 2016.
Fraport AG is one of the leading companies in the international airport business
active on four continents through investments and subsidiaries. At Frankfurt
Airport, its home base, the company operates one of the world's most important
air transportation hubs. In total, Fraport employs around 21,000 people
worldwide. Copelouzos Group is a leading business group with a wide range
of activities in core sectors of the economy such as, among others, energy,
airports, development and real estate management.
Pierre Moscovici, European Commissioner for Economic and Financial
Affairs, Taxation and Customs, said:“Modern infrastructure will play a crucial
role in supporting Greece's economic recovery. This requires sustained
investment to ensure that it achieves its full potential to create jobs and spur
growth. This agreement, with the support of the Commission, succeeds in
mobilising private investment to finance upgrades to growth-enabling
infrastructure that will support, for example, tourism and mobility. This is a
prime example of the type of investments the European Commission is
committed to support, as they bring growth and development.”
Alexander Zinell, Fraport Greece CEO, commented: “The signing of the
financing for the largest concession in Greece is a historic moment. Together
with the equity injected by our shareholders, the proceeds of the loans will help
funding the upfront payment and the four-year airport rehabilitation program.
The successful financing of this complex project is a clear signal regarding the
prospects of the Greek economy and the confidence in our company and the
reliability of our shareholders Fraport AG and Copelouzos Group. The Hellenic
Republic has entrusted us with 14 airports across the country, most of them
gateways to thriving tourist destinations. We are proud to play a significant role
in the future development of these destinations and in support the country’s
tourist industry.”
Vangelis Baltas, Fraport Greece CFO, said: “This agreement has been the
result of a long and fruitful procedure. After 15 months of intense work Fraport
Greece signed with Alpha Bank, BSTDB, EBRD, EIB and IFC a financing
programme with a total volume of nearly EUR 1 billion. Due to the overall
positive impacts of the project on the Greek economy the financing partners
supported the transaction from the beginning. Together with the sponsors
contributions, the total investment amount consists of more than EUR 1,65
billion. We have all worked together ensuring that this complex project is met
with success. We would like to thank our partners for their efforts and
contribution to laying solid foundations for the future course of the concession
project”.
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Capex loan:
Jonathan Taylor, EIB Vice President responsible for Greece, stated: “The
European Investment Bank is pleased to be investing to expand and improve
14 regional airports in Greece. This is a nationally, and regionally, important
project. It will create jobs, and provide a major boost for tourism - a sector that
has proved its importance, and resilience, during the crisis. The EU Bank will
support further investments in Greece that promote growth and help create
sustainable and high quality employment.”
Acquisition loan:
Ioannis M. Emiris, Executive General Manager at Alpha Bank, said: “We
are pleased to arrange, jointly with major International Financial Institutions,
the financing of one of the most significant foreign direct investment in Greece
in recent years. The 14 regional airports together constitute the major
international gateway for Greek tourism, a key contributor to the country’s GDP.
The financing will support Fraport Greece in increasing the capacity and
improving the operational efficiency of these airports, creating new
opportunities and advancing the welfare of the respective communities and
regions. Alpha Bank delivers financing solutions that support economic growth,
reinforce the competitiveness of our economy and create new jobs”.
Ihsan Ugur Delikanli, BSTDB President, said: “As a Multilateral Development
Bank headquartered in Greece, we are particularly happy to contribute to this
major infrastructure project that has a paramount development impact on the
Greek economy. This is an important investment in the future of Greece.
Furthermore, the project is strengthening synergies among MDBs and private
partners and promotes developmental effectiveness for the benefit of this
country and the region”.
Phil Bennett, EBRD First Vice President and Head of Client Services
Group, said: “We are delighted to participate in this landmark transaction,
which we expect to provide a much needed boost to the Greek economy and
in particular Greece’s regional development. The modernisation of this key
infrastructure, especially supporting tourism, will improve access, exchange
and integration. The EBRD is very pleased to support strategic partners who
will bring private funding and expertise to the regional airports in Greece and
could provide an important model for future infrastructure development
projects.”
Dimitris Tsitsiragos, IFC Vice President of New Business, said: “Wellmanaged airports around the world have proven to serve as economic engines.
This landmark concession is an excellent example of how the private sector
can step in to support the Greek economy by generating revenues for the
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government, creating jobs and boosting confidence in vital sectors. IFC’s
involvement in tourism and infrastructure can attract additional investments and
encourage new development projects to promote economic growth.”---ends--
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