1 Financing in the Port Sector EBRD experience in promoting transport solutions Istanbul, May 2012.

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Financing in the Port Sector

EBRD experience in promoting transport solutions

Istanbul, May 2012

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1. What is the EBRD?

2. EBRD in the Transport Sector

3. EBRD in the Port & Maritime Sector

4. Case studies

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What is the EBRD?

The European Bank for Reconstruction and Development:

International financial institution dedicated to promoting transition to market economies by investing mainly in private sector development and entrepreneurship.

Established in 1991. Headquartered in London, the Bank has 36 regional offices.

Largest single investor in the region (30 countries from Central Europe to Central Asia): €71.2bn in more than 3,389 projects since 1991

Owned by 61 countries and two intergovernmental institutions (AAA rated)1

Shortly to beomce 63 as in 2012 Jordan and Tunisia beomce members as part of the process of becoming recipients of EBRD investments

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Mission and Vision

EBRD’s operations are based on three principles

Promotes transition to market

economies, private ownership and good

governance with respect for people and

environment

Promotes transition to market

economies, private ownership and good

governance with respect for people and

environment

Supports, but does not replace,

private investment. Provides

financing at reasonable terms,

otherwise not available

Supports, but does not replace,

private investment. Provides

financing at reasonable terms,

otherwise not availableInvests in financially

viable projects,

together with the

private sector

Invests in financially

viable projects,

together with the

private sector

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Founded in 1991 after the disintegration of the Soviet Union, EBRD’s region of operations covers most countries in Eastern Europe, Central Asia and Turkey.The Bank now intends to extends its mandate to SEMED (Morocco, Tunisia, Jordan, Egypt)

Founded in 1991 after the disintegration of the Soviet Union, EBRD’s region of operations covers most countries in Eastern Europe, Central Asia and Turkey.The Bank now intends to extends its mandate to SEMED (Morocco, Tunisia, Jordan, Egypt)

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EBRD projects span every business sector

Transport

Industry, Commerce& agribusiness

Financial Institutions

Manufacturing & Services

Municipal & Environmental Infrastructure

Power & Energy

Natural Resources

Property & Tourism

Telecommunications, Informatics & Media

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Extensive offer of tailored financial products

DebtDebt EquityEquity

Debt co-financing, working with commercial banks and IFIs

Project finance loans (incl. PPP)

Sovereign, sovereign guaranteed, loans to state owned companies and to private sector (up to 35% syndicating the rest), including SME

Syndication under preferred creditor status

Hard/local currency. Fixed/floating rates

Access to capital markets

Investing with majority sponsor to reduce equity burden and add partnership value. No more than 25%

Common or preferred stock

Privatization and initial public offering (IPO)

Mezzanine equity and subordinated debt

Infrastructure funds

PPP

Technical CooperationAs a Multilateral Development Bank, EBRD brings in additional financial capital and technical assistance (TC) to economically viable projects

Technical CooperationAs a Multilateral Development Bank, EBRD brings in additional financial capital and technical assistance (TC) to economically viable projects

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Strong, internationally recognized partner with long term perspective

Higher risk appetite than other lenders

Long established policy dialogue with Government and Regulators

Unparalleled presence in the region provides mitigation of political and regulatory risks

Preferred creditor status in all countries of operations

Catalysts to access additional finance (every € 1 financed by EBRD leads to mobilize € 3 from other sources2)

Flexible deal structure and product matching services

Dedicated teams with expertise in a variety of sectors and countries

Donor funded Technical assistance available

Benefits of Working with Us

EBRD’s Value-Added: a unique offering

2. EBRD Annual Report 2010

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EBRD Presence in Turkey

Operations began in 2009

Initial focus on sustainable energy, MSMEs in remote regions, agribusiness and utilities

As of January 2011, dedicated Transport Banker in Istanbul

2010 (Cumulative) Number of projects 42 Net business volume € 1.1

billion Total project value € 3.2

billion

In 2011 Business Volume Net business volume € 888

million Number of projects € 26

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4. Case studies

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The Transport Team at EBRD

The Transport Team is part of the EBRD’s Infrastructure Business Group with over 30 banking and sector professionals.

Headquartered in London, with dedicated sector coverage bankers in Astana, Istanbul, Kiev, and Moscow

Dedicated in-team specialists to support procurement, sustainable strategies and project management

EBRD offers banking services (debt and equity) to clients across every transport mode: railways, maritime, aviation and roads1

More info at…

www.ebrd.com/transport

1- Urban Transport is competence of the Municipal & Environmental Infrastructure Team2- Data at end 2011

Transport at a glance2

• € 9.2 billion invested

• Total project value: € 32.5 billion

• 210 projects

• 28 of the EBRD’s 30 countries of operation

Transport at a glance2

• € 9.2 billion invested

• Total project value: € 32.5 billion

• 210 projects

• 28 of the EBRD’s 30 countries of operation

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Extensive Transport portfolio including, but not limited to..

Road Road rehabilitation and construction of new highways, secondary and rural roads, by-passes, maintenance equipment and contracting, toll-motorway construction and operation

Rail

Aviation

Ports &Shipping

Rehabilitation, maintenance and construction of rail infrastructure (track, signaling, power supply, civil structures), Rail operations (rolling stock, maintenance facilities)

Rehabilitation and construction of port infrastructure (berths, quays, land access), superstructure (warehouses, gantries), inland waterways, and vessels

Rehabilitation and construction of airport infrastructure and terminals for passenger & cargo, airline finance, air navigation services (ANS)

Logistics & Intermodal

Construction of intermodal terminals & logistic centres, support to intermodal operators

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4. Case studies

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EBRD in the Maritime sector

At a Glance• No. projects: 45• No. Countries: 13• EBRD Finance/Total project value: € 0.94/ 2.5

bn• % Total portfolio: 21.5%

As the most energy efficient mode of mass transport, which carries 90% of world trade, the Bank supports its development to ensure its capacity to meet growing demand efficiently:

– Active support of private sector involvement in greenfield projects

– Terminal (general, and/or cargo specific, container) and port structures and development of state-owned infrastructure

– Finance of fleet modernisation and capacity development in a market dominated by over-aged vessels. Promotion of short sea shipping operators

– Introduction of energy efficiency and environmental best practices (ie compliance with IMO regulations, membership of ECOPORT)

Long established policy dialogue with regional governments on the commercialisation of port infrastructure and the separation of port infrastructure management from the state

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Some references on the Maritime sector

Some clients in the maritime sector Pre and post delivery financing of Fleet

modernization and capacity development for Fesco, VBTH, BSSM, Circle Maritime Invest, etc.

Expanding capacity with efficient port infrastructure in Poti (Georgia), Durres (Albania), Constanza (Romania), etc.

Support greenfield projects under concession terminal and port structures

Contributing to greening port activity in Russia through equity participation (Globalports)

Supporting a more efficient maritime navigation System in the Gulf of Finland

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PORTS in Turkey

Export/import volume of Turkey recorded 15 % CAGR and reached USD 300 billion in 2010 from USD 67 billion in 1999.

In the last 10 years USD 4.3 billion port investments realized via: privatisations and greenfield investments to catch up with the high growth.

Tekirdag2 mnton

Iskenderun Bay: • Iskenderun 2.4 mnton• Assanport

Mersin0.9 mnTEU

Bandırma4 mnton

Blacksea:Trabzon, Giresun, Rize, Sinop, Ordu, Hopa

Antalya0.3 mn TEU

Med sea:Dikili,Kusadası,CesmeMarmarisAlanya

Ambarli Ports: • Marport: 1.7 mnTEU • Kumport: 1.0 mnTEU• Mardas: 0.6 mnTEU

Marmara ports: • Borusan: 5 mnton, 0.4 mnTEU• Yilport: 2 mnton, 0.5 mnTEU• Gemport: 0.6 mnTEU • Evyap: 1 mnton liquid, 0.6 mnTEU • Derince: 2.5 mnton (*)

Nemrut Bay:0,3 mnTEU

Izmir0.8 mnTEU (*)

(*) to be privatised

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Potential Projects

Privatisations

Galata Cruise Port:

Expected tender: begining of 2012

Purpose: increased cruise port capacity, creating social areas

İzmir Port:

1 mn TEU container port

Privatisation Agency’s bid announcement is expected.

Derince Port:

1 mn ton cargo port

Privatisation Agency’s final strategy is expected.

BOT and Greenfield

State Investments and eventual BOTs:

Çandarlı port: 2 million TEU container port (1st stage).

Mersin port: 1.9 million TEU container port (1st stage).

Filyos port: 25 million ton dry bulk port.

Greenfield investments:

Asyaport : MSC’s container port – expected 1 million TEU

Yarımcaport : DP World’s container port – expected 1.5 million TEU

Petkim port : Container Port – Expected 1.5 million TEU

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4. Case studies

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Case Study

Fesco Vladivostock Port, Russian Federation

Client: FESCO

EBRD finance: $ 100 million

Type of finance: Senior Debt

Total Project cost: $ 340 million

Year: 2011

Project description The proceeds will fund the first phase modernisation of the commercial infrastructure in the port and other priority logistics projects.

Impact Capital investments will result in increased operational standards, greater operational efficiency and significant time savings for the clients

Role of the private sector in the intermodal and inland container terminals and Far Eastern network

Demonstration effect of energy efficient technologies and energy management practices

Fesco, as a leading integrated transportation operator in the Russian market, will upgrade this major infrastructure hub providing much needed improvements in the Russian intermodal and port sector

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Case Study

Euroterminal, Ukraine

Client: Euroterminal LLC

EBRD finance: Up to $ 27 million



Year: 2009

Project description The proceeds finance on-shore container logistics facilities including truck parking, container storage depot and custom terminal “dry port”.

Impact Improvements in the efficiency of container handling operations

Promotion of the development of inland infrastructure at the Port of Odessa

Introduction of environmental and procurement practice to best international practice and corporate governance strategies.

The first integrated logistics centre in Ukraine, built specifically for the purpose of processing containers on shore, thus linking container service in the area of Odessa Commercial Seaport

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Case Study

Poti Port, Georgia

Client: Poti Sea Port Corporation

EBRD finance: $ 8 million



Year: 2010

Project description The proceeds financed the rehabilitation of the container terminal berth, including dredging, paving and replacement of part of the quay and purchase mobile harbor cranes, reach stackers and an empty container handler.

Impact Expansion to eliminate bottlenecks and contribute towards regional expansion

Role of the private sector in the provision of services

Private sector sponsor introduction of corporate governance strategies and enhanced business practice.

Supporting greater involvement of foreign sponsors in the ownership and development of port infrastructure.

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Contacts

Huseyin Ozhan

Principal Banker – Transport

t: + 90 212 386 1100

e: [email protected]

For all further enquiries, please contact :

Sue Barrett

Director – Transport

t: + 44 207 338 6202


One Exchange Square

EC2A 2JN London

United Kingdom

Kanyon Ofis Binasi

Buyukdere Cad. No: 185

Levent / Istanbul / Turkey

Sevki Acuner

Deputy Director – Turkey

t: + 90 212 386 1100


1 Financing in the Port Sector EBRD experience in promoting transport solutions Istanbul, May 2012.

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