This article is part of a daily series of MegaProjects articles. If you want to know more about PPP projects with a considerable size visit our MegaProjects section. You can receive them by email on a daily basis.

The Board of Directors of the Hellenic Republic Asset Development Fund (HRADF) has approved a new offer for the 20-year extension of the concession agreement of Athens International Airport. The offer was submitted by Athens International Airport SA (AIA) and provides for a total price of EUR1.3826 billion (US$1.6 billion), including VAT.

Currently, the shareholders of AIA are the Greek State (25%), HRADF (30%), AviAlliance GmbH (26.7% plus 8 shares), AviAlliance Capital GmbH (13.3%) and the Copelouzos Group (5% minus 8 shares).

AIA initially offered the extension for EUR600 million (then US$675 million) in June 2017. Although approved by HRADF, this was deemed too low by the Directorate General for Competition of the European Commission, as it did not reflect the considerable increase in the airport's passenger traffic.

This new offer thus concludes eight months of negotiations between the parties. The net proceeds from the privatization according to the new offer amount to EUR1.115 billion (US$1.3 billion), a significant increase on those expected from the original - EUR483.87 million (then US$545 million).

In its decision to approve the offer, HRADF took into account an independent evaluation, a professional opinion on the fairness of the financial consideration to be paid to the Fund in connection with the transaction and the positive opinion of the Board of Experts.

The file on the extension of the Concession Agreement will be shortly submitted to the Court of Auditors for the anticipated pre-contractual audit. The completion of the transaction is subject to approvals by the competent European authorities and the Greek Parliament.

On behalf of HRADF, Eurobank Ergasias S.A. & Lamda Infrastructure Finance S.A. acted as financial advisors, Potamitis Vakris Law Firm and Clifford Chance LLP acted as legal advisors, Steer Davies Gleave acted as a technical advisor, while KPMG Advisors S.A. acted as independent valuator and Nomura International plc acted as fairness adviser.