Allen & Overy has advised the Flemish Region and PMV/Via-Invest Vlaanderen NV, an investment vehicle of the Flemish Region, on the development of the A11 highway in Belgium.
The project is the first Belgian public-private partnership (PPP) to be wholly financed by means of a project bond and the first greenfield project (one that involves the construction and operation of an asset) to be financed using the European Investment Bank’s Project Bond Credit Enhancement (PBCE) product.
Described as one of the region’s ‘missing links’, the new highway will play a vital role in stimulating economic growth at the port of Zeebrugge as well as improving the quality of the road network, thus enhancing road safety and quality of life in the region.
Allen & Overy has now advised on all three transactions to come to market which have used the European Investment Bank’s Project Bond Credit Enhancement product and have advised the arranger, the issuer and now the procuring authority respectively on those transactions. Allen & Overy therefore has a unique insight not only into the details and application of the PBCE, but also into the attitude and approach of different parties to the use of the product.
This design, build, finance and maintenance (DBFM) project marks another example of the innovation in infrastructure financing in which Allen & Overy continues to play a leading role.
The Allen & Overy team was led by partner Helga Van Peer and partner Tim Conduit, assisted by senior associates Valentijn De Boe, Tom Constance, Lien Delvoye and Frederiek Adams. Belgian finance advice was provided by partners Sylvia Kierszenbaum and Filip Tanghe, tax advice by partner Patrick Smet and associate Isabelle Panis and advice on permits by partner Gauthier van Thuyne and associate Simon Ceulemans.
Helga Van Peer, partner at Allen & Overy in Brussels, commented: “The A11 is a landmark transaction for the Flemish Region and PMV/Via-Invest. The diversification of funding sources which it represents will undoubtedly benefit future projects in Belgium and elsewhere.”
Tim Conduit, partner at Allen & Overy in London, commented: “This transaction proves conclusively that the capital markets and institutional investors can understand, analyse and accept construction risk. It underlines that institutional investment in PPPs and infrastructure is now an integral part of the funding landscape.”