COUNTRY | Turkey
REGION | Europe
SECTOR | transport
QII Principles | Principle 1 Sustainable Growth & Development, Principle 2 Economic Efficiency, Principle 6 Infrastructure Governance
QII Sub-Principles | 1: SDGs, 2: Life-cycle costing, 2: Operation and maintenance, 2: Risk management, 3: Disclosure of environmental aspects, 5: Job creation, 5: Capacity and institutional building, 5: Occupational health and safety, 5: Universal access to services, 6: Growth & development strategies, 6: Financial & debt sustainability, 6: Access to information and data, 6: Legal and Regulatory Frameworks, 6: Institutional Framework of infrastructure investment, 6: Transparency of infrastructure investment, 6: Enabling Environment
Overview
Mersin Uluslararasi Liman Isletmeciligi A.S. (“MIP”) was incorporated in Turkey in 2007 as a 50-50 JV between Akfen Holding A.S. (‘‘Akfen’’) and PSA International Pte Ltd (‘‘PSA’’). Currently, PSA holds a 51%, IFM Global Infrastructure Fund holds a 39% and Akfen holds a 10% ownership interest in the company. MIP was awarded in May 2007 a 36-year concession by the Turkish authorities to develop and operate Mersin Port. It is Turkey's largest port in terms of import/export container throughput and the largest container port by total throughput. MIP issued two USD-denominated Eurobonds; the first bond in the amount of USD 450m (maturity 7-yrs) was issued in 2013 ? the first Eurobond issue by an infrastructure project company in Turkey ? and the second bond in the amount of USD 600m (maturity 5-yrs) was issued in 2019. The bonds targeted a number of international private qualified institutional investors. The Bank subscribed to both bonds, with ticket sizes of USD 79.5m and USD 90m respectively. IFC is also among the investors both bonds. The proceeds from the second issuance was used for refinancing the first bond, paying the issuance related expenses, and general corporate purposes and capex. The bond is listed on the Irish Stock Exchange.
Timeline
The bonds were issued on 2 August 2013 and on 15 November 2019.
Relevance to QII
The project supports the development of secondary market for PPP transactions through facilitating the entry of new institutional investors and ensures the continuity of the investments of the institutional investors in Turkey. The project improves the financial resilience of MIP through rolling-over its liabilities and increases MIP's competitiveness by funding the capital expenditure programme. Developing the Mersin Port - the gateway of Turkish industry and agriculture to the Middle East - is crucial for the country's economy, and will also support growth in the wider region. Enhanced port infrastructure also helps transform shipping into a more environmentally friendly alternative to land transport. The prospectus of the issuance adhere to high standards of transparency and ongoing reporting/disclosure and the issuance contributes to lowering the information imbalance between the borrowers and lenders.
Benefits
The bond's successful placement contributes to the development of the capital markets and demonstrates new ways of financing for infrastructure investments in Turkey. Through the bond issuance, MIP is able to maintain its position as a leading port in Turkey.
Name of Institution
European Bank for Reconstruction and Development
Website URL