Transaction Advisory Services for Zagreb Deep Sea Container Terminal
Introduction
Since 2007, the World Bank has been funding the Rijeka Gateway Project which aims to improve the effectiveness of the transport chain through the Rijeka Gateway for both freight and passenger traffic by modernising the port and road network connections, and privatising port operations. From the start of this development, MTBS supported the Port of Rijeka Authority (PRA) as transaction advisor with the successful transaction for its Adriatic Gate Container Terminal. From 2017 onwards, MTBS, was again assigned as PRA’s transaction advisor, this time for the second container terminal in the port of Rijeka, which will add more than 1 million TEU capacity in the port of Rijeka: the Zagreb Deep Sea Container Terminal (ZDSCT).
Project Details
DATE
October 2017 – April 2021
CLIENT
Port of Rijeka Authority
PROJECT TYPE
Transaction Advisory Services
GEOGRAPHY
Croatia – Europe
Outcomes
Following a highly competitive tender process, the PRA received a successful bid from the consortium consisting of APM Terminals and ENNA Logic. The transaction outcome is the execution of a valuable concession, in which the Concessionaire commits to infrastructure investments, volume guarantees, operational excellence and rail operations. The concession for the development and economic use of the ZDSCT is granted by the PRA for a period of fifty years. The fixed concession fee is EUR 2.0 M per year and the Concessionaire guarantees a container traffic of 1.0 M TEU already in the first two years of operation. With this concession contract, the new Concessionaire undertakes to fully equip the terminal and add 280 meters of new shoreline.
MTBS Added Value
The success of this project is based on various factors. In the transaction preparation phase, MTBS assessed the project’s financial, technical, environmental, social and legal viability. MTBS developed a tool for the PRA and Croatian Government to decide for the optimal PPP structuring for the ZDSCT concession. After the optimal PPP structure was approved, MTBS tested the transaction in the market. In line with the PRA’s strategy and based on the comments gathered during the market consultations, MTBS – together with Vukić & Partneri – drafted the transaction documents. Further, it was important that the project was fully backed by Governmental commitments, such as port infrastructure, State Road D403 to connect ZDSCT directly to the motorway, and intermodal yard to provide substantial rail capacity for ZDSCT.
