Bulgaria to seek €600 million for Sofia Airport Concession
Bulgaria will seek at least 600 million euro ($699.3 million) investments in Sofia International Airport from the company which wins the forthcoming tender for awarding a concession contract for the airport, the minutes from the government’s meeting on Wednesday show.
In addition, Sofia Airport’s concessionaire will have to make an annual payment of 10% of the total revenue generated from the airport’s operation, but not less than 15 million levs, transport minister Ivaylo Moskovski said during the meeting, according to the minutes.
During the meeting on Wednesday, the government approved the transport minister’s proposal to open a tender for awarding a concession contract for operation of Sofia International Airport.
The concession fee will carry the highest wight in the procedure for selecting a concessionaire, of 55%. The remaining 45% will depend on the presented development plan, business plan, financing plan, general strategy, traffic estimates and capital expenditure.
The requirements for the potential candidates include having a net asset value of at least 200 million euro throughout the last three year and operating at least one international airport with an annual traffic of over 10 million passengers.
In June 2016, the transport ministry launched a tender for a 35-year Sofia Airport concession contract, seeking at least 550 million levs ($326.7 million/281.2 million euro) as a one-off upfront payment.
The tender was cancelled in April 2017 by the then caretaker government, which said that the concession woild lead to a rise in airport charges and a decline of passenger traffic.
After the current coalition government took office in May 2017, transport minister Ivaylo Moskovski said it intends to relaunch the tender and use the revenue from the concession to provide aid to indebted state-owned railways operator BDZ Holding.
“Until another source of financing presents itself, I will continue to follow the initial plan to use the funds from the airport concession to finance BDZ,” Ivaylo Moskovski said at the time.
Following Moskovski’s commitment to relaunch the procedure, German airport operator Fraport announced it was still very interested in winning a concession contract for operating Sofia Airport.
In 2006, Fraport Twin Star Airport Management, a 60/40 joint venture of Fraport and Bulgarian company BM Star, won a 35-year concession to manage the two airports.
According to latest available statistics from the airport operator, passenger traffic at Sofia Airport rose by an annual 7.6% to 600,000 in April. Take-offs and landings at Sofia Airport totalled 5,274 in April, up 11% year-on-year. Cargo volume increased by 9.1% year-on-year to 1,770 tonnes in April.
In 2017, Sofia Airport serviced 6.49 million passengers, up 30.3% year-on-year.
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