China Construction Bank contributes $120.1 million USD to a $600.5 million USD syndicated loan for the Ara Tūhono — Pūhoi to Warkworth PPP Project (Linked to Record ID#104774 and #104775)

Project narrative

In early November 2016, a syndicate of five banks — including the Sydney Branch of China Construction Bank Corporation (CCB) — entered into a $600.5 million USD syndicated loan agreement with NX2, L.P. (or NX2 LP or Northern Express Group) — a New Zealand-incorporated special purpose vehicle (SPV) jointly owned by Public Infrastructure Partners II LP (38.3% equity stake), Accident Compensation Corporation (ACC) (38.3% equity stake), FBII (Puhoi) Limited (13.4% equity stake), and Acciona Concesiones P2W Investment Limited (10% equity stake) — for the Ara Tūhono – Pūhoi to Warkworth Public-Private Partnership (PPP Project). This loan carried a maturity period of five years and a final maturity date in November 2023. This loan was secured (i.e. collateralized). CCB contributed $120.1 million USD to this syndicated loan, as did the four other lenders. Record ID#71599 captures CCB's contribution. In addition to the Sydney Branch of CCB, the following lenders contributed to the loan: the Sydney Branch of United Overseas Bank (UOB), the Hong Kong Branch of DZ Bank AG, ANZ Bank New Zealand Limited, and Westpac New Zealand Limited. All lenders served as Mandated Lead Arrangers; ANZ Bank New Zealand Limited served as Facility Agent and Security Trustee. Then, on October 24, 2023, a syndicate of seven lenders — including the Bank of Communications and CCB — entered into a $779 million NZD (€430 million EUR) syndicated term loan agreement with NX2, L.P for the Ara Tūhono — Pūhoi to Warkworth PPP 2023 Refinancing Project. This loan carried a maturity period of five years and a final maturity date of October 24, 2028. The proceeds were to be used by the borrower to refinance the original $600.5 million USD loan that was maturing in November 2023. Record ID#104774 captures BoComm's contribution. Record ID#104775 captures CCB's contribution. The Ara Tūhono — Pūhoi to Warkworth PPP Project was implemented on a Public-Private Partnership (PPP) basis. On November 2, 2016, the New Zealand Transport Agency (NZTA) awarded a Public Private Partnership (PPP) contract [Contract NZTA PA4030] to NX2 for the project. Under the PPP contract, the NX2 was responsible for the design, financing, construction, management, and maintenance of the Pūhoi to Warkworth motorway for the 25 years following the expected six-year period to build the motorway. Ownership of the highway would remain with the public sector. The asset management and maintenance (AMM) vehicle for the motorway, P2W Services Ltd., was a joint venture between ACCIONA Concesiones and Higgins Contractors (a Fletcher Company). ACC's equity investment in NX2 was estimated to be worth $45.1 million NZD; it also provided a $134.6 million NZD debt facility to NX2. The contract from NZTA was valued $709.5 million NZD (2016 net present value). In addition to this contracted amount, there were two additional payments from NZTA, one of $85 million NZD to the Fletcher/ACCIONA JV to cover the cost of delays and other negative impacts from the five-week long COVID-19 lockdown, and another of $83 million NZD predating COVID-19 to cover the extra costs and delays relating to work on the northern end of the project, due to longer-than-anticipated land purchases and appeals to the Environmental Court. In total, NZTA contributed $877.5 million NZD to this project. This project sought to design and construct a four-lane 18.5-kilometer section of road from Puhoi to Warkworth, from the Northern Gateway Toll Road (NGTR) at Johnstone's Hills tunnels to the south of the Kaipara Flats Road intersection in the north of Warkworth, as an extension of the existing State Highway 1 (SH 1). The motorway traversed to the west of SH 1 and bypassed Warkworth on its western side. It was intended to be the first stage of an extension of SH1 from Ara Tūhono – Pūhoi to Wellsford (Ara Tūhono meaning ‘connecting pathway’). Fletcher/ACCIONA JV was responsible for project implementation. The investigation work for project was performed by Sinclair Knight Mertz (SKM), a specialist in engineering and environmental issues. Hōkai Nuku Ltd, an alliance of the four Iwi (Māori tribes) and Hapū mana whenua – Ngāti Manuhiri, Ngāti Mauku/Ngāti Kauae of Te Uri o Hau, Ngāti Rango of Kaipara and Ngāti Whātua – of the project area provided advice and collaborated on the cultural, social, environmental and economic aspects of the project. The formal sod-turning (groundbreaking) ceremony was held December 6, 2016, and attended by Prime Minister of New Zealand John Key. The contracted Planned Service Commencement Date was October 28, 2021. However, due to the lockdowns associated with the COVID-19 pandemic, the project was delayed; for some periods, work on the project halted completely. NTZA provided $85 million NZD to the Fletcher/ACCIONA JV for the delays. As of July 2022, the planned completion date was the Queen's Official Birthday, June 2022. As of May 2022, a new planned date, falling sometime in 2023, was identified. On June 16, 2023, the motorway was officially opened in a ceremony, with physical opening to traffic occurring on June 19, 2023.