A consortium led by German airport operator Fraport has signed a PPP agreement to operate Pulkovo Airport in St Petersburg, Russia, in which it expects to invest €1.4 billion. The syndicate beat out competing bids from Basic Element with Changi Airports International and Flughafen Wien with ZAO Lider.
The Northern Capital Gateway consortium, which comprises Fraport, holding a 35.5 percent interest, Russian bank VTB, holding a 57.5 percent interest, and Greek investment conglomerate Copelouzos Group, holding a 7 percent interest, reached commercial close on the deal late last week. The agreement will see Northern Capital Gateway take responsibility for the development, reconstruction and operation of the airport, which is the fourth largest in Russia, over a 30-year concession period. The Fraport-led group is set to take over operation of the airport from the City of St Petersburg in April 2010.
A Fraport spokesperson said the company is set to invest a maximum of €150 million of equity and shareholder borrowings in the airport. The spokesperson added that negotiations with international financial institutions and commercial banks are currently in progress regarding the debt financing of the deal, with financial close expected to take place next April.
The consortium is to construct a new passenger terminal, expand apron areas, develop real estate adjacent to the terminal and modernise the airport’s infrastructure.
Northern Capital Gateway is receiving legal advice from Freshfields, financial, tax and accounting advice from VTB and KPMG and technical advice from Halcrow.
Fraport holds shares or management contracts in 12 airports worldwide, including Frankfurt Airport, Cairo International Airport and Xi‘an Xianyang International Airport in China.