Sofia, Bulgaria, April 20, 2021—A private sector-led investment and upgrades to Sofia Airport will help drive economic growth in Bulgaria by enabling increased international trade and tourism, creating jobs and adding value along one of the critical transport infrastructures in the country's supply chain. IFC, a member of the World Bank Group, is providing €30 million to SOF Connect AD, the Sofia Airport concessionaire, to support its operations and infrastructure upgrades.
This is the first major airport-sector transaction to close in the Europe and Central Asia region since the onset of the COVID-19 pandemic. As part of the total financing package of €240 million, IFC's funding will be used to modernize and upgrade the airport, including refurbishment and optimization of existing terminal facilities and aircraft gates to boost efficiency, provide quality passenger services, and expand commercial offerings.
The concession agreement between Bulgaria's Ministry of Transport, Infrastructure, Information Technology, and Communications and SOF Connect—a project company established by Meridiam's Europe Infrastructure III Fund—as the main investor was signed on July 22, 2020. The pool of lenders comprises IFC, the European Bank for Reconstruction and Development, the Black Sea Trade and Development Bank, UniCredit, Société Générale, Kommunalkredit and DSK Bank.
IFC, as the lead transaction advisor, helped the government design a competitive and transparent tender for this public-private partnership—the first major PPP in Bulgaria over the last decade and the first under the new Concession Act. Under the PPP model, SOF Connect AD will be responsible for improving the airport's operations, quality of service, and financing the airport's infrastructure upgrades over the next 35 years before transferring it back to the government.
"IFC's counter-cyclical investment role in supporting one of the sectors most adversely impacted by the COVID-19 pandemic is critical for the recovery of the industry and the Bulgarian economy," said Wiebke Schloemer, IFC's Director for Europe and Central Asia. "The financing will contribute to the growth of passenger and cargo traffic at Sofia Airport, showcasing the private sector's role in delivering efficient solutions to boost the country's critical infrastructure."
IFC's participation will also promote sustainability by supporting the implementation and maintenance of an environmental and social management system and action plan. This will help upgrade safety as well as social and environmental policies and procedures that are consistent with good international practices and IFC's Performance Standards.
About IFC
IFC—a member of the World Bank Group—is the largest global development institution focused on the private sector in emerging markets. We work in more than 100 countries, using our capital, expertise, and influence to create markets and opportunities in developing countries. In fiscal year 2020, we invested $22 billion in private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity. For more information, visit www.ifc.org.
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About SOF Connect AD
Meridiam was founded in 2005 by Thierry Déau, with the belief that the alignment of interests between the public and private sector can provide critical solutions to the collective needs of communities. Meridiam is an independent investment Benefit Corporation under French law and an asset manager. The firm specializes in the development, financing, and long-term management of sustainable public infrastructure in three core sectors: mobility, energy transition and environment, and social infrastructure. With offices in, Addis Ababa, Amman, Dakar, Istanbul, New York, Luxembourg, Paris, Toronto, and Vienna, Meridiam currently manages $8 billion and more than 90 projects and assets to date. Meridiam is certified ISO 9001: 2015, Advanced Sustainability Rating by VigeoEiris and applies a proprietary methodology in relation to ESG and impact based on United Nations' Sustainable Development Goals (SDGs). For more information, visit www.meridiam.com
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