10 May 2013
A joint venture of five Turkish companies has beat international and domestic competition to build, operate and transfer Istanbul’s third airport, planned to be the biggest in the world.
TheÂ Cengiz-Kolin-Limak-Mapa-Kalyon consortium beat rivals at the tender auction with its offer to pay the government $29-billion (22.1 billion euros) for the concession over 25 years, starting from 2017.
Turkey has stated that the airport will be the world’s largest, with an eventual annual passenger capacity of 150 million.
Currently, Istanbul has two airports: AtatÃ¼rk Airport and Sabiha GökÃ§en, handling 37 million passengers and 13 million passengers respectively.
But the government believes they cannot meet growing domestic and international passenger demands.
The capital investment to build the new airport is estimated at $9 billion, reports InfraPPP.
"Such an airport … will carry Turkey to a different level on the international stage," Turkey’s Prime Minister Tayyip Erdogan said, according to Reuters.
AtatÃ¼rk Airport now handles 37 million passengers a year, not nearly enough, Turkey believes. (Credit: Citrat from tr)
Although 17 groups qualified to tender, only four showed up for the bidding auction on 3 May.
They were: TAV Airports, IC-Fraport Consortium, Cengiz-Kolin-Limak-Mapa-Kalyon Consortium and Makyol Ä°nÅŸaat.
Fifteen Turkish and two foreign companies had bought tender documents for the PPP project.
The two foreign companies that did not show up were Malaysia’s national investment fund, Khazanah Nasional Beerhad and India-based GMR Infrastructure.
InfraPPP reported that in order to increase competition, Turkey lifted the three-company limit for consortiums and also the requirement that a dominant partner own a 51% share.
The first phase of construction will last 42 months and will provide an initial capacity of 90 million passengers a year.
Six runways will be completed in future phases, increasing the capacity up to 150 million passengers.
Reuters reported that the consortium of Turkish firm IC Ictas and Germany’s Fraport placed the highest bid – $26.15 billion – for the lease in the first round.
That was much higher than the second-highest bid of $16.7 billion bid by a Turkish consortium.
But the five-firm Turkish group won in the final bidding round.