Metito reaches financial closure on US$60.8m PPP Sub-Saharan Africa water project
- December 4, 2017
- Category: Africa
Metito and the Government of Rwanda have reached financial closure on the first competitively tendered Build Operate Transfer (BOT) bulk surface water supply project in sub-Saharan Africa.
The finalisation of the Public Private Partnership (PPP) agreement spells the start of execution of the highly-anticipated Kigali Bulk Water Supply Project with construction forecast to last 30 months from the commencement date.
The plant will provide 40 million litres a day of fresh and clean water, 40% of the Kigali city’s potable water requirements, to the residents of Rwanda’s capital city to serve domestic, commercial and industrial end users.
The Kigali Bulk Water Supply Project will be located in Kanzenze, in the South Eastern part of Kigali.
The treated water will be extracted from the south bank of the Nyabarongo River and will supplement existing water supplies in a strategic move to meet Kigali’s growing water demands – a city with a population of over one million residents.
The project is being developed by Kigali Water Limited (KWL), a fully owned subsidiary of Metito, a global provider for intelligent water management solutions with 60 years of experience developing and managing water facilities across the world covering four continents.
KWL will design, build, maintain and operate the treatment plant and will then sell potable water to the Water & Sanitation Corporation of Rwanda (WASAC) under a 27- year PPP Agreement.
The Emerging Africa Infrastructure Fund (EAIF), a member of the Private Infrastructure Development Group (PIDG), is the mandated Lead Arranger of the financing of this project which is worth US$60.8 million.
EAIF and The African Development Bank (AFDB) are covering US$40.6 million of the capital cost of the project; US$38 million of Senior Debt and US$2.6 million of Junior Debt with all loans on 18-year terms. The balance will be provided by Metito as equity finance. The Kigali Bulk Surface Water Supply PPP project also benefits from a US$6.25 million grant from PIDG’s Technical Assistance Facility (TAF).
The landmark project was awarded to Metito through an international and competitive tender process and will pave the way to other similar capital intensive projects in Africa and a catalyst that can enhance the international investor community’s appetite to invest in Rwanda.
Provision of a secured and sustainable water supply is expected to have a huge impact on the socio-economy of the country.
David White, Chairman of the Emerging Africa Infrastructure Fund commented:
“The conclusion of the financing is tremendous news for Rwanda. Fresh, clean water has a fundamental role to play in economic development and water-dependent businesses like hotels, food processing and leisure, will have greater confidence in investing in Kigali. The financing exercise has been a model of cooperation between EAIF, the AFDB, the Government of Rwanda, and Metito.”
According to Mutaz Ghandour, Metito Chairman and CEO, the PPP project puts Rwanda on the map for the international investor community which, once complete, will become an exemplar project for PPPs in the region.
“Africa has huge potential and we expect this to continue as critical infrastructure develops around the provision of key utilities. To undertake such capital intensive infrastructure projects, the PPP scheme remains to be the best, and sometimes unavoidable, formula, and Metito acknowledges this.
Metito’s global growth strategy is aimed at expanding its presence in Africa, and augmenting its well established and tested operations in North, West and now East Africa.