Officials from the Ministry of Finance Public Private Partnership (PPP) Unit and the National Bank of Egypt are meeting this week to arrange LE 4.5 billion financing needed for the Rod El-Farag Corridor, Al-Mal newspaper reported.
This will be the first project to be launched and offered to investors under the newly-approved PPP scheme, after the passing of the new law in August 2010. The law’s executive regulations will be finalized in November 2010.
The amount of financing represents around 81.8 percent of total investment cost of the project, which is a 34-kilometer road corridor (Rod el-Farag) linking Cairo’s ring road to the Cairo-Alexandria desert road, Beltone Financial reported in a note early this week.
The period of the financing is expected to range between 10 and 15 years and will be structured according to Staple Financing, a pre-arranged financing package, that includes all the loan amount, conditions, covenants and fees, and offered to investors prior to the bidding process, Beltone reported citing Al-Mal.
The National Bank of Egypt is expected to invite local Egyptian banks to participate in the financing scheme once it is finalized with Ministry of Finance.
Five international consortia from Austria, Greece, China, South Korea and Egypt have in October 2010 expressed interest in bidding for the project including Austria’s Strabag which is partnering with Egypt’s EFG-Hermes, Korea’s GS Engineering & Construction, and Greece’s GEK Terna and Austria’s PORR who are partnering with Egypt’s Hassam Allam Contractors.