A consortium teaming Japanese financial services group Orix Corporation (Orix) with France's Vinci Airports (Vinci) has been chosen to run the Kansai and Osaka international airports.
The pair will pay JPY2.2 trillion (€16.7 billion; $17.9 billion) to the government upon completion of the deal, with additional cash to be disbursed should the business make more than JPY150 billion in annual revenue.
The consortium was the sole bidder for the concession, with the contract's length and the risks associated with it said to have daunted other interested parties.
The consortium will set up a concessionaire company to enter into a project agreement with New Kansai International Airport (NKIA), the current operator, by end of this year. They will each have a 40 percent interest in the company. Local shareholders will own the remainder.
The concessionaire company's funding plan totals JPY260 billion, JPY80 billion of which shall be paid out of shareholders contributions.
Set to span over 44 years, the two airports' operations are scheduled to be transferred to the concessionaire company in late March 2016.
The business plan includes inviting more new airline routes to ensure traffic growth, as well as enhancing its commercial businesses, including retail and food outlets, to increase revenue.
The amount of investment required to maintain and improve the airport is estimated at JPY944.8 billion, or an annual average of JPY21.5 billion.
Kansai International Airport, opened in 1994, is located on an artificial island in the middle of Osaka Bay. It serves both as international hub and domestic airport, with a traffic of 20 million passengers.
Osaka International Airport, often called Itami Airport and opened in 1939, is the primary domestic airport for Osaka city, with 14.6 million passengers.
Following the deal, Vinci will become one of top five world airport manager, with a total of 27 airports and more than 100 million passengers managed annually.
Established in 1964, Osaka-based Orix has business interests in lending, investment, life insurance, banking, asset management, automobile related, real estate, environment and energy related businesses.
State-owned NKIA will retain ownership of the runways, terminals and other facilities. Part of the proceeds from the sale will be used to repay debt.