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A consortium formed by BAM-PGGM, Eiffage and Berger Bau has reached financial close on the A94 road PPP project in Germany.

The team, advised by Bank of Tokyo-Mitsubishi UFJ (BTMU), beat out competition from the consortium made up Strabag and Meridiam in November 2015.

The consortium has secured a 29-year €250 million senior term loan from KfW IPEX, BayernLB, DZ Bank and Dekabank and a €160 million senior loan from the European Investment Bank (EIB). The total debt package sums €410 million.

DLA Piper was legal adviser to the sponsor team and Allen & Overy to the lenders.

German federal government will finance up to €215 million through payments during the construction period.

The 30-year concession contract will begin with the groundbreaking ceremony, which is scheduled on 1 February 2016. The project is due to be completed in the second half of 2019.

The PPP project involves the design, build, finance, operation and maintenance (DBFOM) of a 33 km road between Pastetten and Heldenstein. Additionaly, it includes the operation and maintenance (O&M) of a 77 km route of the A-94 road between Forstinning and Marktl. 

The concession contract has a value estimated at €1.1 million (US$1.16 million).

Christian K. Murach, member of the Management Board of KfW IPEX-Bank, commented on the closing:

"We are very pleased to be involved in an important German PPP. This instrument allows making optimal use of private investor liquidity to renew and expand public infrastructure. In Germany, PPP has been used only sporadically until now, whereas in a number of other European countries it is already a frequent, flexible and successful financing option with a proven track record for major public infrastructure projects."

The completion of the A94 is among the priorities listed in the latest Federal Transport Infrastructure Plan (Bundesverkehrswegeplan). The section included in this project will alleviate traffic on the existing but saturated federal road B12, which reports one of the highest accident rates in Bavaria. Vehicles seeking an alternative often use minor roads, which causes inconvenience and disruption to local inhabitants. The new section is also expected to draw traffic from two motorways running North (via Passau) and South (via Salzburg).