MegaProject 909: A7 motorway reaches financial close
- VINCI - VINCI Concessions
- Meridiam Infrastructure
- European Investment Bank (EIB)
- Development Bank of Japan
- KfW IPEX Bank
- DZ Bank
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VINCI Concessions subsidiary VINCI Highways and Meridiam Infrastructure have completed the financial arrangements for the A7 motorway public-private partnership (A-Modell) covering a 60 km section between the Bockenem and Göttingen interchanges in Germany.
Total financing amounts to €441 million (US$469 million), and encompasses two long-term and two short-term tranches. The European Investment Bank, CaixaBank, Development Bank of Japan (DBJ), DZ Bank and KfW IPEX-Bank underwrote the debt, and the arrangement includes a €126 million (US$134 million) grant from the federal government.
This financial arrangement follows the decision by the federal government, represented by the Lower Saxony authorities, to award the contract for the A7 project to the consortium formed by VINCI Concessions and Meridiam Infrastructure, in February 2017. The contract will take effect on 1 May 2017.
This 30-year A-Modell contract covers financing, design, programme management (upgrade and widening works), operation and maintenance of the A7. The works involve entirely replacing a 29.2 km section with a new motorway (three lanes each way) while keeping the existing route open to traffic throughout this phase.
The A-Modell is a German contractual framework for financing renovation and widening of existing motorways and construction of new sections under concessions to the private sector. The concession company is paid fees based on infrastructure availability. This mechanism thereby provides incentives for concession companies to optimize renovation, widening and maintenance works, i.e. minimise their impact on traffic.
A consortium led by Eurovia, the VINCI subsidiary specialized in transport infrastructure construction and urban development projects, and including Stutz and Rhode, two local companies, will take about three and a half years to complete the works.
The A7 is VINCI Highways’ fourth public-private partnership contract won in Germany, where the company now operates a 220 km network.