News

At the Eastern Economic Forum a direct agreement between the Khabarovsk Territory in the person of the Ministry of Economic Development, «Regional Concession Company», LLC within the VIS Construction group (VIS CG) and Gazprombank has been signed. This agreement is one of the most important documents required to achieve financial closure of the project on construction and operation of the road «Bypass of Khabarovsk 13 km — 42 km». Kachkin and Partners has carried out comprehensive legal support for the participation of the concessionary (RCC, LLC) in the negotiations of the direct agreement between three parties.

The direct agreement defines order and procedures for interaction between the concession provider, the concessionary and the financing organization in the implementation of the project, also for the purpose of risks sharing between the parties of the concession agreement and the financing organization.

Construction of the road «Bypass of Khabarovsk 13 km — 42 km» will connect three federal highways (A-370 «Ussuri», R-297 «Amur» and A-375 «Vostok»). It is assumed that the toll road will not only relieve the city center from the pressure of transit traffic, but also will be a starting point for the construction of new transportation system with People’s Republic of China.

One of the market leaders in the field of the infrastructure projects financing in Russia – Gazprombank — has performed as the financial agent in this project. Gazprombank is planning to provide the funding of RCC LLC for an overall amount of 10 billion rubles. The complete financial closing of the transaction will take place in the end of 2017.

The legal support of the project by Kachkin & Partners covered assistance in the preparation of the concessionary’s negotiations with the concession provider and the financing organization at the stage of concluding the direct agreement, as well as advising the concessionary on various legal issues related to implementation of the project and preparation for financial closure (including analysis of credit terms, preparation of contractor agreements, adaptation of insurance contracts, subordinated loans, other contracts and agreements to the project).

Denis Kachkin, Managing Partner, Head of Infrastructure and PPP Practice of Kachkin and Partners, has underlined: “The conclusion of a direct agreement certainly is a significant step in the Khabarovsk transport bypass project, and it is no coincidence that the largest economic event in the Far Eastern region was chosen as a platform for signing — the Eastern Economic Forum, during which the most promising Russian and foreign investment projects have been presented. We are grateful to the participants of the agreement for their confidence, and we are ready to continue effective work for the benefit of further successful implementation of this initiative, that is strategically important for the transport infrastructure of Russia.”