Blankenburg Connection PPP project reaches Financial Close
Landmark Blankenburg Connection PPP project reaches Financial Close and commences construction. Photograph – Deme
Date 29 October 2018
On 17th October 2018, the BAAK consortium – Macquarie Capital (70 per cent of SPC), Ballast Nedam (15 per cent of SPC) and DEME (15 per cent of SPC) – reached financial close on the €1 billion Blankenburg Connection PPP project in the Netherlands. The Blankenburg Connection is a design, build, finance and maintain (DBFM) project which will improve road links between Rotterdam and its port – and is the largest PPP project awarded in the Netherlands to date.
The BAAK consortium was selected as the preferred bidder for the project by the procuring authority Rijkswaterstaat in August 2017, reaching Contract Close in December 2017. Since then, the consortium has further developed the designs and obtained the required permits. Following the effective Route Degree in July 2018, the consortium commenced construction on 1st September 2018, and successfully reached Financial Close on October 17.
The A24 Blankenburg connection is a large and complex project, fitting a three-lane highway in-between two existing highways. The project involves the Design, Build, Finance and Maintenance (DBFM) of a new highway connection of approximately 4 km (linking the A15 and the A20 roads, to the west of Rotterdam) including a land tunnel of c. 500m (Holland Tunnel), an immersed tunnel of c. 900m (Maasdelta Tunnel), two major flyovers and the widening of the existing A20. Following a construction period of 5.5 years, the consortium will then maintain the new road connection for 20 years.
In the design and construction of the Blankenburg connection, the interests of key stakeholders including the government, businesses and local residents are at the forefront. With smart technical solutions, the consortium limits the impact for the environment and businesses. For example, the consortium will realize the immersed tunnel with only two elements instead of the intended six elements in the reference design. Therefore the waterway – the connection to Main Port Rotterdam- needs to be closed off less often. Furthermore, building materials are supplied via water and where possible techniques providing less noise are used. Currently, preparatory works have started on site to create access on land and water.
Martijn Klinkhamer, director at BAAK: “We are very proud that BAAK has reached this important milestone for the Blankenburg project. We are very happy with the professional lending group and the long term robust financing structure to support the construction and maintenance works of this project.”
Macquarie Capital also acted as the sole financial advisor and debt arranger to the consortium. The total senior funding requirement for the Project of c. €900 million brings together commercial floating rate lenders (KBC, The Korea Development Bank, Belfius, KfW, BNG and SMBC) and fixed rate institutional lenders (Natixis, MEAG and Samsung Life Insurance). The European Investment Bank provided 50 per cent of the term loan, totalling c. €330 million, backed by the European Fund for Strategic Investments (EFSI).
The EPCM consortium consists of an integrated JV between Ballast Nedam Infra and the DEME Group companies DIMCO BV and Dredging International. DIMCO and Ballast Nedam contribute their extensive capabilities to execute all civil infrastructure works, tunnel installations and project management activities. More specifically, Dredging International will perform the trench dredging and nautical works, and DIMCO will perform the immersion works of the tunnel elements on the busy fairway to the Port of Rotterdam.
Willem Stitselaar, Managing Director and Head of Macquarie Capital in the Benelux region: “Macquarie Capital has a leading track record in mobilising private sector capital into large scale energy and infrastructure projects globally. We invest from the early development stages to make projects happen and we are proud to be part of the BAAK consortium, supporting the delivery of this vital infrastructure project in the Netherlands.”
Alain Bernard, Director and CEO DEME Group: “The Consortium brings together the unique capabilities of financing, developing large infrastructure works, DBFM project management, and tunnel immersion technology. We are pleased to be working with strong and complementary partners and look forward to the successful execution of this major project. The participation of the DEME Group on both the Sponsor side and on the marine and infrastructure side for the Construction, are a key success factor in the DEME strategy to deliver comprehensive solutions in developing infrastructure projects. For DEME’s subsidiaries Dredging International and DIMCO, the project is an opportunity for jointly employing their expertise in our Benelux home market, optimally exploiting the synergies in our activities within the group.”
Sander Lefevre, Board member Ballast Nedam: “We are delighted that we have reached this important milestone for this unique project. The Blankenburg connection is a good example of the solid projects that represent our order book. We are proud to be part of the outstanding project organisation. This strong team combines the expertise and manpower of several disciplines. I’m confident that this team will ensure Rijkswaterstaat of a high-quality and efficient project, with a punctual completion.”