Macquarie Korea Infrastructure Fund

Gwangju Second Beltway Section 1

Assets

Gwangju Second Beltway Section 1

The first PPI project in Gwangju, the fifth largest metropolitan city of Korea.

Asset overview

Gwangju Second Beltway, Section 1 is a 5.6 km, dual three-lane expressway consisting of four tunnels, ten bridges and two interchanges, running from the Gwangju Dooam Interchange to the Sotae Interchange outside the city of Gwangju with tolling at two separate locations. In response to the expansion and development of industrial areas around Gwangju, construction of the Gwangju Second Beltway commenced in 1997 to ease traffic congestion on the Gwangju First Beltway and to provide better links to the surrounding cities. Construction of Gwangju Second Beltway Section 1 began in June 1997 and was completed in December 2000.


Investment details

MKIF has invested in Kwangju Beltway Investment Co., Ltd. ("KBICL"), the concessionaire of Gwangju Second Beltway, Section 1. As of record date, MKIF is a 100.0% shareholder of KBICL. MKIF's total investment amount is KRW 205.6 billion (equity KRW 33.1 billion, senior loan KRW 87.3 billion, subordinated loan KRW 82.0 billion and working capital facility KRW 3.2 billion).

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Concession agreement  
Government authority Gwangju Metropolitan City
Concession term 28 years
Guarantee duration N/A (investment cost compensation)
Concession term commencement January 2001
Minimum Guarantee N/A (investment cost compensation)
Revenue Cap N/A (investment cost compensation)

*As part of the capital restructuring transaction completed in December 2016, the Minimum revenue guarantee provision was replaced with the Investment cost compensation provision. Please refer to MKIF disclosure on 16 December 2016.

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Facilities  
Length 5.6 km
Capacity 6 lanes in both directions

Asset location