Updated with full bank list, size of debt package and total investment value.
The Singapore Sports Council has awarded the world’s largest sports public-private partnership (PPP) contract to a consortium led by a subsidiary of French construction firm Bouygues and HSBC Infrastructure Fund III.
A club of 11 banks provided a debt package of S$1.8 billion (€1 billion; $1.3 billion) to help the project reach financial close with a refinancing to kick in following the construction period. Total investment costs for the project, which will redevelop the existing Singapore National Stadium, are thought to be close to €1.2 billion.
The 11-bank club comprises BNP Paribas, Bank of Tokyo-Mitsubishi, Credit Agricole, DBS, HSBC, NAB, Natixis, OCBC, SMBC, Standard Chartered and WestLB.
The winning consortium will receive availability payments from the Singaporean authorities over the length of the contract. These payments are doled out to the private partner in exchange for making the facility available in good condition. Third party revenues generated by the facility will be shared between the consortium and the procuring authority.
The sports complex first tried to reach financial close in 2008 but was unable to do so following the collapse of Lehman Brothers and its impact in the debt markets. The project was subsequently restructured by the government.
In addition to Dragages Singapore, a Singapore-based subsidiary of Bouygues, and HSBC Infrastructure Fund III, the winning consortium also comprises local facilities management company United Premas and Global Spectrum Pico Holdings, part of sports group Comcast Spectator.
HSBC Infrastructure Fund III reached a $580 million first close at the end of March. The fund targets investments in PPPs with low revenue risk, including social infrastructure and transportation projects in developed markets. It is aiming to reach a final close of $1 billion.
Hogan Lovells Lee & Lee provided legal advice to the procuring authority while PwC provided financial advice. Deutcshe Bank and Linklaters acted for Singapore's ministry of finance. Legal firm Norton Rose provided legal counsel to the winning consortium. Ashurst provided legal advice to the lenders.