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Rio de Janeiro GIG and Belo Horizonte CNF final conession agreements approved; auction 22-Nov-2013

7-Oct-2013 8:27 AM

Brazil's Rio de Janeiro Galeão International Airport and Belo Horizonte Tancredo Neves International Airport's final concession agreements were approved (04-Oct-2013) by regulator ANAC. The auction will be held 22-Nov-2013 with bidding to be made simultaneously, and each bidder or consortium may only win one of the two auctions. Past privatisation winners at São Paulo GRU, Campinas and Brasilia are restricted to 14.99% participation in any consortium. State-owned operator Infraero will retain a 49% stake in both airports. The specifics break down as:

  • Galeão:
    • Concession Period: 25 years, extendable for an additional five years;
    • Minimum bid: BRL4.8 billion (USD2.1 billion);
    • Estimated investment required: BRL5.7 billion (USD2.6 billion);
    • Mandatory works: Construct 26 aerobridges by 30-Apr-2016, expand apron by unspecified amount by 30-Apr-2016, construct 1850-vehicle parking garage by 2015, ensure "adequacy" of cargo storage facilities for 2016 Olympic Games and construct system of independent runways once airport reaches 262,900 operations p/a;
    • Bidder experience requirement: Operator with experience handling airports serving more than 22 million passengers p/a at least once in the past five years must hold at least a 25% stake in any consortium, a requirement which may be met by up to two operators;
  • Tancredo Neves:
    • Concession period: 30 years, extendable for an additional five years;
    • Minimum bid: BRL1 billion (USD453 million);
    • Estimated investment required: BRL3.5 billion (USD1.6 billion);
    • Mandatory works: Construct new passenger terminal with "at least" 14 aerobridges and related airport access works by 30-Apr-2016, expand apron by unspecified amount by 30-Apr-2016 and construct second runway by 2020, or once airport reaches 198,000 operations p/a;
    • Bidder experience requirement: Operator with experience handling airports serving more than 12 million passengers p/a at least once in the past five years must hold at least a 25% stake in any consortium, a requirement which may be met by up to two operators.

Immediate terminal upgrades must be made at each airport in terms of signage, washroom renovation and provision of free Wifi access, among others. A 120-day transition period will follow after the signing of the contracts, during which Infraero will work together with the new concessionaires to manage the facilities, followed by a 90-day period during which the concessionaires will operate the facilities with Infraero in support, prior to the concessionaires assuming full operational control. The two airports currently account for 14% of passenger movements in Brazil and 10% of cargo movements. Galeão currently handles 17.5 million passengers p/a which is expected to increase to 60 million passengers p/a by the end of the concession in 2038. Tancredo Neves currently handles 10.4 million passengers p/a which is expected to increase to 43 million passengers p/a by the end of the concession in 2043. [more - original PR - Portuguese]