Meridiam signs agreement for €3.3bn Slovakian highway

The first 56 kilometer stretch of the central European country’s D1 highway has also attracted funding from the European Investment Bank and the European Bank for Reconstruction and Development.

A consortium of investors that includes France’s Meridiam Infrastructure Fund has signed a concession agreement for a €3.3 billion stretch of the D1 highway in Slovakia.

The contract – Meridiam’s first investment in the central European country – is expected to reach financial close in the second half of the year. It will require the Slovenské Dial'nice consortium to design, build, finance, operate and maintain the 56 kilometer road for a concession period of 30 years.

The project will require €2.5 billion of capital expenditures.

Meridiam is a 19 percent shareholder in the consortium alongside construction and engineering partners Bouygues (19 percent), Mota-Engil (19 percent), Ascendi (19 percent), Doporastav (19 percent), and Vahostav (19 percent). Intertoll, a Hungarian toll and motorway infrastructure developer and operator, holds the remaining 5 percent stake.

The consortium will be rewarded for its investment via availability payments, or periodic payments usually predicated on lane availability, level of service and other factors.

Meridiam has no plans to increase its stake to 49 percent by buying out several of the developer’s interests in the project, according to a person familiar with the transaction.

Both the European Investment Bank (EIB) and the European Bank for Reconstruction and Development will commit funding to the project. The EIB recently raised the amount of funding for the project from €700 million to about €1 billion.

Meridiam, Crédit Agricole Private Equity’s fund specialising in investment in public-private partnership deals, closed on €600 million in April 2008.

Slovenian highways: under construction.