We are pleased to announce the successful closure of our next transaction this year. Our client Szybka Kolej Miejska Sp. z o. o. („SKM”) – rail operator for the Warsaw agglomeration, has raised 216 mln PLN in debt finance. The funds will be used to complete the railway connection between the city centre and F. Chopin Airport, as well as the purchase of 13 modern trains. The financing is in the form of a bond issue, in two tranches long- and short-term, with BRE Bank as the investor and guarantor of the issue.

Holon Consultants was the sole financial advisor to SKM in the investment process, including business plan preparation, selection of the optimal financing form, investor selection, transaction negotiations and final credit agreement.

This railway modernisation and train purchasing project, whose total value exceeds 300 mln PLN, was co-funded by SKM’s own funds and by support from the Infrastructure and Environment Operational Programme of the EU Cohesion Fund.

„The Bond issue is the most advantageous means of financing the development of SKM. This Programme was prepared with the utmost diligence”, said Leszek Walczak, CEO of Szybka Kolej Miejska, at the press conference to announce the bond issue agreement on 28th September.

„It’s pleasing to see that municipal companies are also applying this financing method to their development. Not long ago we witnessed the signing of a credit agreement between Metro Warszawskie and the European Bank for Reconstruction and Development. Today Szybka Kolej Miejska becomes the next municipal company, introducing a new instrument to its policy by financing part of its funding needs through a bond issue”, said Andrzej Jakubiak, Deputy President of Warsaw.

Seven of the 13 trains ordered by SKM have already been delivered. The order is to be fully completed by the end of October 2011. The inauguration of the connection to Fryderyk Chopin Airport is planned for the 1st quarter of 2012. The SKM trains will depart from the airport every quarter-hour.

The manufacturer of the „Elf” train vehicles is PESA Bydgoszcz S.A. Elfs differ from most of the trains travelling on our lines. They’re air-conditioned, sound-proofed, have soft seats and quick acceleration. Each is 108 metres long and can carry nearly a thousand passengers, including 274 seated. They’re the longest trains in Poland without compartments.

„The financing project was initiated many months ago. SKM hired an advisor, who helped to select a funding means. The main alternative to the bond issue was a loan from the European Investment Bank. As the EIB’s terms turned out to be relatively inflexible from a formal perspective, when the proposal of the commercial banks was attractive, the decision was taken to pursue the latter route”, Dariusz Kacprzyk, Director in BRE Bank SA, said to the press.