Turkey: North Marmara Highway - Nakkaş-Başakşehir BOT Project

approved

The Project involves the development, construction, and operation of the Nakkaş-Başakşehir section of the Northern Marmara Highway (NMH). The 438-kilometer (KM) NMH is one of Turkey's highest-value investments in the road sector. NMH bypasses Istanbul's congested road network to the north and provides additional dual carriageway connectivity between Asia and Europe, through the Third Bosporus Bridge or Yavuz Sultan Selim Bridge (YSS Bridge). The Project is the NMH's eighth section and comprises a toll road linking the western and northern districts of Başakşehir, Arnavutköy, Avcılar, and Çatalca, an area located on the European side of Istanbul, between the city center and the New Istanbul Airport. The Project's contractual length is 45 km and comprises 31.31 km of main and connection roads, a 1.6 km cable-stayed bridge crossing the Sazlıdere valley, 17 overpasses, 19 underpasses, 56 culverts, 11 junctions, and 7 viaducts. The Project's total cost is approximately EUR1.45 billion and benefits from a concession term of approximately 18 years.  The Project is regulated by the Implementation Contract (IC), a Build-Operate-Transfer (BOT) agreement signed between the Borrower as the Appointed Company (AC) and the General Directorate of Highways (KGM or the Authority). It contemplates a minimum revenue guarantee (MRG), paid semi-annually. Both MRG and toll are paid in TRY and indexed for EUR inflation.  The Project is owned by Rönesans Holding A.Ş. (Rönesans), through NAK Infrastructure Investments B.V., a wholly owned subsidiary incorporated in the Netherlands and by a consortium of Korean investors formed by Samsung C&T Corporation (Samsung), Korea Overseas Infrastructure & Urban Development Corporation (KIND), and KIAMCO PIS Infra Special Asset Investment Trust No.1 (PIS Fund), an investment trust established by the Government of Korea, managed by KDB Infrastructure Investments Asset Management Co. Ltd. (KIAMCO) and represented by KEB Hana Bank as trustee. The Project is built by REC Uluslararası İnşaat Yatırım Sanayi ve Ticaret A.Ş., a wholly owned subsidiary of Rönesans (the EPC Contractor or REC), under a lump-sum turn-key (LSTK), fixed-price and date-certain agreement with the AC that covers the design, engineering, procurement, construction, testing, and commissioning works of the Project (the EPC Contract). The Project will be operated under an Operations and Maintenance agreement (the O&M Contract) by an entity to be owned by Rönesans through RNS PPP Altyapı Ticaret A.Ş., Samsung C&T and Korea Expressway Corporation (KEC) (the Operator).