Page 74 - TURKRptFeb20

Turkey’s main international flight hub following a rapid construction process that resulted in the deaths of scores of workers and an unknown number of people killed by allegedly speeding trucks carrying building materials—has got off to a less than auspicious start. Officials are ambitious to develop it until it reaches the status of “world’s largest airport”, but it is experiencing substantial teething problems.
The problems are such that national flag carrier Turkish Airlines, which transferred its operations HQ and Istanbul flights from Ataturk to Istanbul Airport, endured a summer during which its share price dropped, while that of low-coster Pegasus, which uses Istanbul’s relatively small Sabiha Gokcen Airport as its main hub, rose. Istanbul Airport, thought to have cost up to $12bn after a big overspend, is located on the foggy Black Sea coast and local reports have shown it struggling against far too many diverted flights, delays and long runway taxi times. Pursued as a grand infrastructure project ostentatiously backed by Turkish strongman leader Recep Tayyip Erdogan, the airport was in April described by travel expert and consultant Ben Schlappig as “breathtaking” but one of the most poorly designed in the world.
A source close to the refinancing matter told Reuters that Dome would start talks with banks in coming weeks. “In this meeting, it will obtain participants for the syndication,” the source was quoted as saying, adding that it is expected to have a low interest rate. “A syndication that will give IGA significant breathing room is expected.”
IGA took out a €4.5-bn loan for the airport project with a 16-year maturity and a four-year grace period on the principal. Total investment in the project was predicted to be €6bn. IGA later borrowed another billion euros for additional financing.
IGA now consists of Kalyon, Cengiz, Mapa and Limak construction companies. Kolin, which was previously involved, transferred its shares to the other partners earlier this year.
Ziraat Bank, Halkbank, Vakifbank, Denizbank, Garanti BBVA and Finansbank were among the lenders that gave the loan.
● Others
Turkish carrier Atlasjet resumed flights on December 21 after it halted all of its flights on November 26, stating that the switching of its services to new mega airport outside Istanbul earlier this year had caused it cash flow problems.
74 TURKEY Country Report OUTLOOK 2020 www.intellinews.com