Turkey’s Rönesans studies Morocco, Senegal PPP projects with France’s Meridiam

ISTANBUL

Turkish construction and investment firm Rönesans Holding’s healthcare unit is working with French fund Meridiam on public–private partnership (PPP) investments in Morocco and Senegal, the Rönesans board chairman told Reuters on Dec. 20, also giving details about the planned financing deals for the group’s city hospital projects. 

Rönesans will complete a yen-denominated loan deal worth $1.5 billion for its Istanbul İkitelli city hospital project from Japanese banks JBIC, Nexi, SMBC and BTMU by the end of March, board chairman Kamil Yanıkömeroğlu said at a press meeting, held to announce financing worth 288 million euros through bond exports from a group of investors entirely made up of foreign investors for the Elazığ City Hospital project in eastern Turkey. 

The healthcare investment firm will also complete in 1-2 months a 400 million euro ($415.56 million) loan deal to finance a hospital project in Bursa, from European banks and one Chinese bank.

The project rating of the Elazığ project has been determined as Baa2 by Moody’s thanks to the innovative credit improvement tool provided by the European Bank for Reconstruction and Development (EBRD) and the MIGA, a member of the World Bank Group, according to a follow-up press release. 

The bond export amounting to 288 million euros was made through private placement to a group of foreign investors consisting of the IFC, the Japanese financial institution MUFG, Italy’s Intesa Sanpaolo, Germany’s Siemens Financial Services, France’s Proparco, Dutch FMO and the Industrial and Commercial Bank of China (ICBC), according to the release. 

“Such a new innovative credit improvement tool has been used for the first time in a financing in Turkey. We secured a large part of the bond on the basis of a 20-year term. Furthermore, the project’s environmental and social benefits were evaluated by an institution called Vigeo that analyses the environmental, social and managerial characteristics of projects in international markets and also the bond of our Elazığ project was confirmed as a Green and Social Bond,” said Yanıkömeroğlu, quoted in the press release. 

“Our main objective of developing these innovative credit improvement tools is to decrease the risks in rising markets, and thus attract the investment that is needed for the infrastructure work,” said Thomas Maier, the EBRD Managing Director for Infrastructure. 

“The fact that we have combined our forces with the MIGA in order to increase the funds’ rating is also an indication of how the international financial institutions are close to support environment-friendly and sustainable investments,” Maier added, stating that they initiated this mechanism in Turkey in order to bring it to other countries where they make investments.

“The capital markets allow access to long-term and stable sources of finance, which play a very important role in terms of providing the majority of society with affordable health services. We expect this successful bond export that has been carried out for Elazığ to lead the sector and also other projects of Turkey regarding the health sector to utilize similar models, and thus pave the way for providing the sector with long-term financing,” said Aisha Williams, the IFC’s country manager for Turkey. 

Elazığ City Hospital will furnish services to nearly 20,000 patients and patients’ relatives per day with its indoor construction site of 355,000 square meters and a total inpatient bed availability of 1,038.