Global law firm White & Case LLP has advised the International Finance Corporation (IFC) as Lead Transaction Advisor and the General Authority of Civil Aviation (GACA) as Grantor on the US$1.2 billion financing of a landmark transport infrastructure deal—the first public-private partnership (PPP) for an airport in the GCC region.
The Madinah Airport Project involves the expansion and renovation of Prince Mohammad Bin Adbulaziz International Airport located in the Holy City of Madinah that will increase its capacity from around 3.5 million passengers per year to 8 million per year by 2015, with additional possible increases in subsequent years that could raise its capacity close to 20 million passengers per year. It achieved financial close on 30 June 2012.
"This is a landmark project for Saudi Arabia, not only because of the deal value and the significance of any major infrastructure project in the city of Madinah, but also because this project will serve as a roadmap for all subsequent airport PPPs in the Kingdom," said Antoine Cousin, local partner at White & Case. "As a global law firm, we were able to utilise our unparalleled experience to structure the deal, covering both international and Saudi law aspects from our Riyadh office."
Structuring, tendering and closing the deal required complex operational, legal and financial solutions, including in order to avoid disruptions to existing operations during the hand-over phase. Tibah Airport Development Company, a special-purpose vehicle formed by Turkish operator TAV Airports Holding, and Saudi Oger and Al Rajhi groups, is the concessionaire appointed by GACA. Tibah will develop a new passenger terminal, renovate the existing runway and all airside facilities, and operate and maintain the facility for 25 years. The construction of a second runway is also contemplated.
The project is part of Saudi Arabia's wider plan to increase capacity across the region through the development of billions of dollars' worth of airport projects and is the first true large-scale 'concession' project in Saudi Arabia where commercial risk is being borne by the private sector.
The White & Case team was led by local partner Antoine Cousin (Riyadh), with support by associates Ivan Paskal and Hamad Al-Hoshan (both based in Riyadh) and Sherief Rashed (based in Abu Dhabi).
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