Bank of Ireland co-finances multi-million N17/N18 Road Project
Bank of Ireland today, (30 April 2014) announced that it has co-funded a Public Private Partnership (PPP) project to construct the new N17/N18 road between Gort and Tuam in County Galway. Contracts have been signed, construction will start later this year and the road is expected to be completed during 2017. The Bank is part of a group of funders who are providing over €300 million of debt for the project.
Bank of Ireland and the European Investment Bank (EIB) together with French banks Natixis and Societe Generale provided the debt funding for the project. The contracts have been awarded to the Direct Route consortium and the roads will be constructed and operated by a group of leading Irish contractors – John Sisk & Son, Roadbridge and Lagan alongside Strabag, a major Austrian contractor. It is expected that in excess of 450 new construction jobs will be created during the construction phase.
Other shareholders in the Direct Route consortium include two large European infrastructure investment funds – Marguerite and HICL Infrastructure Company Ltd.
The N17/N18 Gort to Tuam PPP Project, a 57 km stretch of motorway standard dual carriageway, forms an important part of the Atlantic road corridor. It is a strategic component of the national primary route network providing high quality north-south linkage in the western region. The project is a significant development, enhancing not only road safety but also increasing capacity, reducing journey times and thereby benefitting trade and commerce along the route.
Donal Murphy, Director, Project Finance, Bank of Ireland Corporate Banking said: “Bank of Ireland’s funding commitment to the Irish infrastructure market since 2008 is now well over €500m and we are recognised as the leading project finance team in the Irish market. This transaction is another very important milestone for the Irish infrastructure market in that it demonstrates that privately financed projects can continue to be delivered. Of real significance is the presence of two major European banks alongside ourselves and the EIB. For some time Irish infrastructure projects were not attractive to overseas funders due to the perceived risks associated with the Irish economy. This significant commitment from overseas banks signals growing international confidence in Ireland. Bank of Ireland is proud to bring our local experience and expertise to this international funding group. We believe the return of international funders to the market augers well for the financing of the Governments programme of PPP projects across the Roads, Schools, Healthcare and Justice sectors”.
Commenting Tom Hayes, Chief Executive, Bank of Ireland Corporate Banking said: “This transaction highlights Bank of Ireland’s commitment to supporting Ireland’s recovery. As the leading financier of infrastructure projects in the Irish market we look forward to continuing to play a key role in funding critically important infrastructure projects like the N17/N18”.