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| Summary of Project Information (SPI) |
| This Summary of Project Information is prepared and distributed to the public in advance of the IFC Board of Directors’ consideration of the proposed transaction. Its purpose is to enhance the transparency of IFC’s activities, and this document should not be construed as presuming the outcome of the Board decision. Board dates are estimates only. |
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| Project number | 21495 |
| Project name | Kusadasi Cruise Ship Terminal |
| Country | Turkey |
| Sector | Transportation And Warehousing |
| Department | Infrastructure |
| Company name | Ege Liman Isletmeleri A.S. |
| Environmental category | B |
| Date SPI disclosed | March 18, 2004 |
| Projected board date | April 30, 2004 |
| Status | Completed |
| Previous Events | Invested: November 4, 2004
Signed: June 22, 2004
Approved: May 10, 2004 |
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| Description of company and purpose of project |
Ege Liman Işletmeleri A.Ş, (Ege Ports) is a special purpose Turkish company specifically incorporated to operate a cruise ship terminal in Kuşadasi (the Kuşadasi Port) under a 30-year concession granted by the Government of Turkey (GOT) in July 2003 following a competitive bidding process. Kuşadasi Port is the largest cruise ship terminal in Turkey and is a popular port of call on cruises that originate in Greece, Italy, France, Spain and Turkey. Ege Ports offers the following basic services to ships calling at the port:
- tugging,
- pilotage,
- sheltering,
- clean water supply,
- disposal of solid waste,
- underwater diving inspection, and
- fuel supply.
The proposed project comprises the operation and expansion of the Kuşadasi Port, including the financing of the $24.3 million concession payment to the GOT; construction of a new passenger terminal; extension of the existing berths and purchase of equipment necessary for carrying out operations of the Kuşadasi Port. The proposed project will bring Kuşadasi Port operations into compliance with the International Port and Facility Security (ISPS) Code. |
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| Project sponsor and major shareholders of project company |
The description of the project sponsors and their shareholding of Ege Ports is as follows:
Shareholders:
Royal Caribbean Cruises Limited at 27.5%
Akfen Holding A.Ş at 25.0%
Avrasya Yatirim Holding A .Ş 20.0%
Ege Ticaret Limited Şti 20.0%
Marvel Investments S.A. 7.5%
- Royal Caribbean Cruises, Ltd. (“RCCL”)
was established in 1969 under the name Royal Caribbean Cruise Lines by three Norwegian shipping companies. In 1993, the shares of RCCL were listed on the New York Stock Exchange (symbol RCL), and currently RCCL is the second largest cruise operator in the world. The Company operates under the Royal Caribbean International and Celebrity Cruises brands with a fleet of 25 modern cruise ships, and a passenger capacity of approximately 53,000. RCCL has a market share of 25% of the global cruise industry. In addition to cruise ship operations, RCCL has invested in and operates several cruise ship terminals in the U.S. and Mexico.
Akfen Holding A.Ş. (“Akfen”)
is one of the major construction groups in Turkey. In addition to its core construction business, Akfen Group has business interests in various industries including tourism, foreign trade, insurance brokerage, and natural gas distribution. Established in 1976, Akfen Group currently operates through 8 companies and 12 subsidiaries. Since 2000, Akfen has been a 49% shareholder in TAV, which in October 1997, was awarded a 3 year 9 month (after completion) concession for the expansion and management of the Ataturk International Airport in Istanbul.
- Avrasya Yatirim Holding A.Ş. (“Avrasya”),
founded in 1998, is a holding company, which has interests in several companies in Turkey operating in the finance, information technology and fast food sectors.
- Ege Ticaret Limited Şti.
is a special purpose Turkish company established specifically for the Kuşadasi Port investment. The company is wholly owned by Mr. Erol Goker, a Turkish businessman.
- Marvel Investments S.A. (“Marvel”),
a Liberian company with its headquarters in Athens, is an investment company established specifically for the Kuşadasi Port investment. The owner of Marvel, Mr. Erkunt Oner, owns Tura Turizm & Seamer Tours, a travel and shipping agency which he founded in 1966. Tura Turizm is the tour agent for RCCL in Turkey. |
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| Total project cost and proposed IFC investment |
| The total project cost is estimated at $29.3 million. The proposed project consists of an A loan of up to $10 million and an equity investment of up to $0.5 million, both for the account of IFC, and a B loan of up to $8 million for the account of participants |
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| Location of project and description of site |
The Kuşadasi Port is located in the city of Kuşadasi which is situated on the west coast of Turkey in the southern Aegean Sea, 90 kms south of Izmir. Kuşadasi is known as one of the most attractive cities in the Aegean region, and is only about 20 kms from the Greco/Roman City of Ephesus, the site of the Temple of Artemis (one of the wonders of the ancient world), the Basilica of Saint John (where Saint John is buried), the Isa Bey Mosque and the Museum of Selçuk. In the nearby hills lies Merymana, reputed to be the place where the Virgin Mary died and a place of pilgrimage for Christians. The area has numerous other historical and cultural sites.
The existing port facilities consist of two parallel piers (the “old” pier and the “new” pier) separated by about 93 m and oriented in a North West – South East direction. The “old” pier is smaller than the new one and has outside and inside berth lengths of 262 m and 158 m, respectively. The “new” pier provides berths of 235 m on the inside and 258 m on the outside. The piers provide drafts of 9 m near the shore, increasing to 14 m at the ends. There is a small terminal building which is used for entry and exit of the passengers to the port. There is also a bus staging area located within the port area with a capacity of 50-60 buses. |
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| Project Development Impact and IFC's Role |
The development impact of the project would be substantial. The major revenue earner in Kuşadasi is tourism and the main asset in this regard is the Kuşadasi Port. The privatization of Kuşadasi Port will ensure, through more efficient operation; enhanced security; and a focused marketing program internationally, long-term economic growth of various local small businesses in Kuşadasi which depend on the cruise ship traffic. In addition, efficient and effective management of the Port will attract additional cruise lines to make Kuşadasi their port of choice. The revenue generated by tourism in the region is essential for the ongoing maintenance and development of the areas’ historic sites. The main tourism destination for passengers from the cruise ships arriving at the Port of Kuşadasi is Ephesus and the surrounding area. Hence, the links between the successful operation of the Port and the development of Kuşadasi and the Ephesus area are very strong. Furthermore, the proposed project would ensure that the port is operated in an environmentally sound manner.
IFC's investment in the proposed project would provide long-term financing necessary for a concession-based project at a reasonable cost. In this context, IFC will also help catalyze long-term financing from a financial institution(s) through the B loan. Long-term limited recourse financing is practically nonexistent in Turkey from either domestic or foreign sources. This was evidenced by the cancellation of the first concession granting process due to the winning bidder’s inability to raise financing. In order for the GOT’s privatization program to be successful, private sector companies need to be able to raise long-term financing. The proposed project is the first major cruise ship port privatization in Turkey and its successful financing would also have a strong demonstration effect on potential investors in other privatizations of other ports in Turkey. |
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| Environmental and social issues - Category B |
This is a Category B project according to IFC’s Procedure for Environmental and Social Review of Projects because a limited number of specific environmental, social and cultural impacts may result which can be avoided or mitigated by adhering to generally recognized performance standards, guidelines or design criteria. The review of this project consisted of appraising technical, environmental, social and cultural information submitted by the project sponsor, as well as site visits to the Kusadasi Port and to the nearby town of Selcuk where Ephesus is located. The following potential environment, health and safety, social and cultural impacts of the projects were analyzed.
- Pollution control and waste management;
- Fuel handling and emergency response;
- Employee health and safety;
- EHS management systems; and
- Cultural and archeological heritage.
Ege Ports has presented plans to address these impacts to ensure that the proposed project will, upon implementation of the specific agreed measures, comply with the EHS and social requirements and Turkish country laws and regulations and the IFC environment, social and cultural policies and the environmental, health and safety guidelines.
To view the environmental documents for this project, click here |
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| Location of environmental documents in locally affected community |
Environmental documents will be made available at the following locations:
- Ege Ports’ office located at the Kuşadasi Port, 09400 Kuşadasi – Aydin, Turkey.
- The offices of the Municipality of Kuşadasi. |
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| To contact the project company, please write to: |
Mr. Gregory M. Kiez, Chairman
Ege Ports
Kuşadası Port
09400 Kuşadası, Aydın Province
Turkey
Phone: +90 (256) 614 15 81
Fax: +90 (256) 614 13 10
E-Mail: Gregk@egeports.com |
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