A2 Nowy Tomyśl - Konin
In October 2000 AWSA signed a financing plan that forms an integral part of the Concession Agreement (Annex 4) between AWSA and the government, defining the implementation costs of the A2 Project between Nowy Tomyśl and Konin.
The total cost was agreed at EUR 875 million, of which 73% would be direct construction and design costs of EUR 637.5 million. This price is lump price for the entire "turn-key” project, i.e. a motorway that is fully equipped and ready for use.
The remaining EUR 237.5 million provided in the financing plan includes:
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Costs of preparing the motorway operation and purchasing the relevant equipment, fees paid to the Operator for the motorway maintenance and operation during the construction phase;
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Credit charges and fees and interest payable on financing provided by third parties;
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Rent and fees payable to the State Treasury under the guarantee (EUR 11 million in total),
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Concession fee of EUR 9 million paid to the State Treasure,
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Fees paid to legal, tax, financial advisors and traffic advisors of the Concessionaire and of the project crediting banks,
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Funds collected and not used by the end of 2004 to be used for the extension of the three motorway intersections to connect with the national roads in the future;
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Funds collected and not used by the end of 2004 to be used for payments of some of the interest.
Finally, the financing of the motorway for the First Concession Section Nowy Tomyśl – Konin was realized using:
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The capital contribution made by the Project Investors (over 27%), without precedent in Poland,
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Long-term credits from the European Investment Bank (33% - EUR 275), credit payment was conditional on obtaining the State Treasury guarantee,
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Long-term financing provided by a consortium of commercial banks (26% – EUR 235 million) – so called Main Credit
The remaining 15% comes from income earned for the motorway operation (toll collected in the Toll Plazas) and interest income earned on deposits of funds earned during the project implementation.
The Concessionaire exercises comprehensive control over the spending. An analysis of the current toll income that is slightly higher as forecast shows that no risk of using the State Treasury guarantee exists.
Based on the financing model – i.e. a schedule of income and expenses relating to the construction, financing and operation of the A2 Toll Motorway (Nowy Tomyśl - Konin section) developed for the entire concession phase until 2037 - it is estimated that AWSA, the Operating Company and the Construction Company shall pay to the State Treasury about PLN 16.2 billion in form of VAT, income tax and other fees imposed on the Concessionaire during the Concession Period.
Further, if the return is above 10%, the State Treasury shall receive 20% of income, and if the return on investment is above 15% - the State Treasury share shall increase to 50% of income distributed.
It is difficult to measure the positive impact of the A2 Project on the economic growth of the regions through with the motorway runs and on the economic development of the entire country.
A2 Świecko - Nowy Tomyśl
The funds amounting to 1.6 billion EUR for the design and construction of the motorway to Świecko come from three sources:
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the loan from the European Investment Bank of EUR 1.0 billion (ca. 62% of the Project cost);
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the loan from 11 international and Polish commercial banks of EUR 400 million (ca. 26% of the Project cost); banks have granted also the loan for VAT expenditures in the amount up to 150 million PLN. The following 11 commercial banks are committing/ lending funds to the Project: BBVA S.A.Bank, Pekao S.A., BRE Bank S.A., Caja Madrid, Calyon, Deustche Bank AG, Espirito Santo Investment, KfW IPEX-Bank GmbH, PKO BP, Societe Generale, WestLB;
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shareholders’ contribution of more than EUR 186 million (ca. 12% of the Project cost), including:
- share capital (EUR 50 million),
- junior loan (EUR 136 million).
The one billion EUR loan from the European Investment Bank is an unprecedented commitment of the EIB with respect to an infrastructural project in Poland. The EIB loan could even correspond to 70% of the project cost. The EIB commitment was up to EUR 1.2 billion, however in view of the increased involvement on the part of the commercial banks and the shareholders, it was decided to apply only part of the available funds. Such considerable amount of the EIB loan granted is a token of the reliability of the Concessionaire and its shareholders as a business partner.
84.5% of the total cost are direct construction and design costs of a fully equipped and ready for traffic motorway amounting to EUR 1.298 million. Other major costs which have been provided for in the Assumptions Book include:
during construction period:
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cost of preparation to the Financial Close (analyses and development of the financial model, legal, financial and insurance advisors, some of the design works),
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costs of preparation to the operation of the motorway and procuring the required equipment,
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fees payable to the Independent Engineer,
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insurance,
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change of the toll system in the section Nowy Tomyśl – Poznań for a closed system, i.e. the one to apply to the new section,
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special bat protection barriers and wider animal bridges,
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fees and interest on the loans during construction amounting to ca. EUR 175 million;
throughout the entire concession, i.e. by the year 2037:
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lease and concession fees,
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fees and interest on loans and credits,
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remuneration payable for the maintenance, toll collection and safety provision;
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renewals, including lane painting, renewing signage, rehabilitating bridges and buildings, etc.,
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cost of building and modifying the layout of certain interchanges and other facilities,
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heavy maintenance of the pavement in years 2025, 2030 and 2035,
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company costs (including fees of the advisors to both the Concessionaire and the lending banks).
On the basis of the financial model, that is the plan of inflows and outflows relating to the construction, financing and operation of A2 Toll Motorway in the section Nowy Tomyśl – Konin throughout the entire concession term, it is estimated that AWSA II, the Operating Company and the Development Company will provide the State Treasury, during the term of the concession, with ca. PLN 1.3 billion of the VAT and income tax.
The concessionaire will be remunerated with respect to the section Świecko – Nowy Tomysl according to the availability system. This means that , according to the Construction and Operation Agreement, the State Treasury leases the land where the motorway must be built to AWSA II, commissioning the construction of the road within 2.5 years and the operation for another 25 years, in return of which the company will be paid a monthly fee specified in the agreement for making the motorway fully available to the users. The major duties of AWSA II include the procurement of the financing, the construction of the motorway using such funds and subsequently the maintenance of the road in compliance with the relevant high standards, as well as the toll collection on behalf of the State Treasury. In return, AWSA II will be remunerated by the public partner , in the amount securing the repayment of the loans and the fair return on the sponsors’ equity invested in the project.
