Limak signs KD 249.2m syndicated credit agreement with NBK and KFH
Agreement to partly finance Kuwait Airport’s new passenger Terminal II
KUWAIT: Limak Insaat, one of world’s leading contractors currently constructing the new passenger terminal at Kuwait International Airport, and Kuwait’s two largest banks, the National Bank of Kuwait S.A.K.P. (NBK) and Kuwait Finance House K.S.C.P. (KFH), yesterday signed a KD 249.2 million Syndicated Credit Agreement to partly finance the construction, completion, furnishing and maintenance of Kuwait International Airport (KIA) New Passenger Terminal II.
Under the Agreement, NBK is the Mandated Lead Arranger, Intercreditor Agent, Security Agent and Account Bank, and KFH is the Mandated Lead Arranger and Commodity Murabahah Investment Agent. With the signing, NBK and KFH will jointly finance KD124.6 million each to facilitate construction works on KIA New Passenger Terminal II currently being constructed by Limak, a global awardwinning construction company. The terminal is designed to handle 25 million passengers per year and accommodate all aircraft types through 51 gates and stands.
The agreement was signed by Limak Holding Chairman Nihat Ozdemir, NBK Chairman Nasser Musaed Al-Sayer, and KFH Chairman Hamad Al-Marzouk. In attendance at the signing ceremony were Ayse Hilal Sayan Koytak, the Ambassador of the Republic of Turkey to Kuwait and her delegation, and senior executives and board members from Limak Insaat, Limak Holding, the National Bank of Kuwait, Kuwait Finance House, and the Ministry of Public Works.
At the signing ceremony the Borrower, Limak Insaat represented by Limak Holding Chairman Ozdemir, presented the company’s current construction progress on the new passenger terminal and announced the commencement of construction of the superstructure, commission of the region’s largest Steel and Concrete Cassette Factory, prepared operations of a Precast Arch Factory, and 33 tower cranes prepared for mobilization with a lifting capacity of 100 thousand metric tons.
Limak Holding Chairman Nihat Ozdemir said: “We are extremely happy and proud to have taken part in the construction of this iconic new terminal building which will be Kuwait’s new gateway. This financing agreement demonstrates our capacity to work with international financial institutions for a project that we have undertaken abroad as a Turkish contracting company. The signing of the agreement today is an extremely important step for our strong and lasting relationship with Kuwait where we also have a hospital and infrastructure works project in addition to the airport. Today marks a remarkable day for the future of our business in Kuwait and we hope to extend the strong relationship between us to other countries using Kuwait’s financing power and the ability of Turkish companies to do business.”
Iconic new terminal building to be Kuwait’s new gateway
NBK Chairman Nasser Musaed Al-Sayer said: “The National Bank of Kuwait is pleased to be selected as the lead arranger of this transaction to finance and arrange credit facilities for the new passenger terminal project at Kuwait Airport. This reflects our strong commitment to be the partner of choice for the world’s leading and renowned contractors, executing Kuwait’s multibillion dollar projects. Our journey with Limak actually started in 2016 when we partnered with KFH to issue a Performance Bond on behalf of the company for the much awaited New Passenger Terminal. Since then, we’ve been providing the day-to-day banking support to Limak and are delighted to conclude and sign today Limak’s needs for additional banking facilities including Bank Guarantees, Letters of Credit and Working Capital, to the tune of KD 249.2 million.”
He added, “ever since our incorporation in 1952, NBK has worked handin-hand with the government and private sector to support the development needs of Kuwait. We have a long and well established track record of backing critical infrastructure projects important for Kuwait’s economic expansion. The New Passenger Terminal is one such project. Valued at KD 1.3 billion, the contract will also inject significant funds into the local market, bolstering Kuwait’s private sector and pushing our economy toward the success envisioned by His Highness the Amir’s Kuwait 2035 development plan.
The new passenger terminal, due for completion in August 2022, is a strategic part of this development and will open the doors for other critical developmental projects.
Because as we all know, building infrastructure is necessary for the development of Kuwait’s potential, we cannot build a successful and growing economy without first laying the solid foundation of infrastructure needed to support such growth. In supporting Limak in building this new passenger terminal, NBK reaffirms our commitment to building our beloved country’s future achievements and success.”
KFH Chairman Hamad Al-Marzouq said: “Kuwait Finance House is honored to be selected as the lead arranger for sharia-compliant facilities for this landmark project considered to be one of the most important construction and infrastructure projects under Kuwait’s development plan. Under this agreement we will contribute to the extension of credit lines for the Kuwait International Airport Terminal II project to Limak who have significant experience in establishing international airports. The transaction builds on KFH’s growing track-record of financing mega-projects with advanced sharia-compliant finance solutions spanning four decades. We wish Limak success in the completion of the airport project and look forward to a fruitful and long-lasting relationship and cooperation on future vital projects.”
Transaction Facts and Figures:
• Syndicated Credit Agreement value: KD 249.2 million
• Mandated Lead Arranger, Intercreditor Agent, Security Agent and Account Bank: National Bank of Kuwait
• Contribution: KD 124.6 million
• Mandated Lead Arranger and Commodity Murabahah Investment Agent: Kuwait Finance House
• Contribution: KD 124.6 million Airport Project Highlights:
• Concrete Foundations: 80% complete
• Precast Arch Factory: ready for operation
• Steel and Concrete Cassette Factory: commissioned and now the largest plant in the Middle East
• Baggage handling system, facade, roof covering lifts, escalators, and travelators: out to tender
• Lifting Capacity: 100,000 tons with 33 tower cranes and 10 crawler cranes are installed and ready for mobilization. Expected to break a World Record.
• Construction of the superstructure has commenced
• Subcontractors: 25% are local companies and over KD 30 million spent on National (Kuwait) Products.
• Over 3,000 people are currently working on the project: expected to increase to 12,000 by Q3 2019.
• Approximately 4 million hours of non-stop work since the start of the project.