IFM snares $3b deal for European mega-airport
London | IFM Investors has shrugged off a Europe-wide squeeze on infrastructure projects, winning a Polish tender to build and run a passenger and cargo airport at the centre of a $12 billion regional transport hub.
CPK, the state-owned project manager for the Solidarity Transport Hub – the biggest infrastructure project in Poland since the end of the Cold War – chose IFM and its French partner, Vinci Airports, in a year-long tender process worth as much as $3 billion.
IFM’s success comes as rising borrowing costs are putting the brakes on European infrastructure development. Australian institutional investors have been keen to plunge capital into Europe, but find big deals increasingly hard to come by.
It is the third investment that IFM has made in Poland, following the purchase of stakes in a deep-sea port in 2019, and a district heating-generation system back in 2010.
IFM’s Global Infrastructure Fund will become a minority equity investor in the CPK unit building the airport. CPK suggested the outside investors’ stake could go as high as 49 per cent. This means the IFM-Vinci investment could total as much as $3 billion. IFM declined to comment.
The airport, which CPK says could open as soon as 2028, will initially have two runways and reach an annual capacity of 40 million passengers and 1 million tonnes of cargo by 2035. It could eventually expand to four runways and 100 million passengers.
It will be built about 40 kilometres west of Warsaw. It will not replace Warsaw Chopin Airport, but is seen as a regional logistics hub. The government plans to build high-speed railway connections from the airport to several Polish cities and into Germany.
Outside its Australian airport investments, IFM has stakes in Manchester and Vienna airports. The airports Vinci owns or runs include Gatwick in London, several in the US and Japan, and an extensive list in countries including Portugal, France, Brazil and Mexico.
CPK said IFM and Vinci would bring “experience and know-how” during the Polish airport’s construction phase, and then operate it on the state-owned company’s behalf.
The participation of IFM and Vinci was “proof that the CPK is a well thought-out project”, said Marcin Horala, deputy minister of funds and regional policy.
“CPK means the creation of a central European passenger hub, and at the same time allows for huge revenues from air cargo, which have so far been lost on Poland,” he said. “It will not only drive the Polish economy, but will guarantee a high rate of return on investment.”
The Polish government will change after the October 15 election. Assuming the new regime sticks with the project, details of the IFM-Vinci investment are likely still being hammered out.
The government said 60 per cent of the finance to build the airport would come from bond issuance or syndicated lending, while 40 per cent would come from the IFM-Vinci equity investment into CPK. The Polish government would always retain at least a 51 per cent equity stake, CPK president Mikolay Wild was quoted as saying.
Worldwide, IFM manages $US72 billion ($114.1 billion) of equity assets in infrastructure and $US6.5 billion in infrastructure debt. In Poland, it has stakes in Veolia Energia Polska, the country’s largest district heat generation platform, and Baltic Hub, a deep-water container terminal in the coastal port city of Gdansk.
Poland’s economy was among the fastest-growing in Europe last year, but has slowed sharply recently as inflation sapped consumer spending. Investment growth has remained more robust. Poland has a population of almost 38 million, and its GDP per capita is forecast to surpass that of Britain in the early 2030s.
Introducing your Newsfeed
Follow the topics, people and companies that matter to you.
Find out moreRead More
Latest In Infrastructure
Fetching latest articles