DLA Piper and Sabev & Partners advise Bulgarian Government on Sofia airport concession

DLA Piper and Sabev & Partners, as part of the consulting teams of the International Finance Corporation supported by the European Bank for Reconstruction and Development, have advised the Government of Bulgaria on a concession agreement and tender procedure for the Sofia Airport in Bulgaria.

On 22 July 2020 the Government of Bulgaria, through the Minister of Transport, Information Technology and Communications, and the SOF Connect Consortium led by the asset manager Meridiam signed a concession agreement for a period of 35 years for the operation of Sofia Airport in Bulgaria. The other members of the winning consortium are Munich Airport and Strabag.

In 2018 the Bulgarian government initiated an open tender procedure for awarding a mixed concession, including works and operation services, for Sofia Airport. . The tender attracted a high number of bidders and led to a very competitive process with the initial award made by the Bulgarian government following a review by Bulgaria’s Supreme Administrative Court.

In its winning offer the Meridiam-led consortium offered to pay an upfront fee of BGN550 million (EUR281 million) as well as an annual concession fee of the higher of (i) 32% of the airport's annual revenues for the duration of the concession, or (ii) EUR24.5 million per year. Additionally, the parties agreed on further investments to be made by the concessionaire, part of which to be in a new terminal.

The project was led by DLA Piper partners Jasna Zwitter-Tehovnik (DLA Piper Vienna) and Francesco Ferrari (DLA Piper Milan) together with Boryana Boteva (partner at Sabev & Partners Sofia). The team also consisted of skra Neycheva (partner, Sabev & Partners), Ivan S. Maleš (senior associate,Vienna) Domen Brus (Associate, Vienna) and Luigi Mula (senior associate, Milan) Alessandro Carofiglio (ssociate, Milan).

Jasna Zwitter-Tehovnik, finance, projects & restructuring partner at DLA Piper Vienna commented: "I am very pleased that the agreements were well-written and attracted many of the best bidders in the world, but foremost that the signing was achievable despite the current situation. The parties involved showed great farsightedness and commitment to the economic recovery of the airport sector"