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ORIX Corporation - VINCI Airports consortium has closed financing for the 44-year concession of Kansai International Airport and Osaka International Airport in Japan.

Mizuho Bank and Sumitomo Mitsui Banking Corp. (SMBC) have arranged a total of JPY190 billion (US$1.68 billion) syndicated loan to the new operator. The loan comprises a 30-year, JPY160 billion yen portion, of which approximately a 40% will be shouldered by Mizuho and SMBC, and a JPY30 billion yen line of credit. 

Project financing has been provided by 13 syndicate member including the two bookrunners. Mizuho Bank will act as the Facility Agent for the overall administration of the financing while SMBC will act as the Security Agent for the security-related matters.

The two Bookrunners are leading project finance banks with significant track records in the sector. 

Crédit Agricole Corporate and Investment Bank, Development Bank of Japan Inc. and The Bank of Tokyo Mitsubishi UFJ, Ltd. were also Lead Arrangers in the deal. 

Other lenders included: The Senshu Ikeda Bank, Ltd., Sumitomo Mitsui Trust Bank, Limited, The Shiga Bank, Ltd., Nippon Life Insurance Company, The Nanto Bank, Ltd., Resona Bank, Limited., The Bank of Kyoto, Ltd. and The Kiyo Bank, Ltd..

The total project investment is estimated at JPY260 billion (US$2.3 billion). The new operator will pay an annual JPY39.2 billion in fees out of revenue gained from airport operations, to New Kansai International Airport Company (NKIAC), the current operator.

NKIAC selected the ORIX Corporation -VINCI Airports team as Preferred Negotiation Right Holder for the airports concession in November 2015. ORIX and VINCI will have the same shareholdings (40% each), and minority shareholder companies from the Kansai region will hold 20% overall.

Together, the Kansai and Osaka international airports, had a total of 34.6 million passengers in fiscal year 2014-2015, which represents the second busiest airport group in Japan. The growth in traffic last year (+7.4%) has been supported by the excellent results of tourism in Japan and the development of the low-cost carriers for which the Kansai International Airport is the main hub in the country.

Kansai International Airport is Located on an artificial island in the middle of Osaka Bay, 38 km southwest of ?saka Station, located within three municipalities, including Izumisano, Sennan and Tajiri. The airport was opened on 4 September 1994 to handle increasing passenger numbers at Osaka International Airport, which is closer to the city of Osaka and now handles only domestic flights. The airport serves as a hub for local airlines such as All Nippon Airways, Japan Airlines and Nippon Cargo Airlines.

Osaka International Airport is the primary domestic airport for the Kansai region of Japan, including the major cities of Osaka, Kyoto, and Kobe. It is classified as a first class airport. Kansai International Airport took over Osaka's international traffic in 1994 and competes with Itami for domestic traffic.