Istanbul airport owner seeks to refinance up to $5.6 billion in debt

IGA, the operator of Istanbul Airport, is seeking to refinance as much as 5 billion euros ($5.6 billion) in loans it used to build the facility, Reuters reported.

The company aims to lower the cost of repayment of the loans. It has mandated Dome Group of London to find banks to take part in the deal, Reuters cited IGA as saying.

Turkey says the airport, promoted by President Recep Tayyip Erdoğan as a symbol of Turkey’s emerging global stature, will be the world’s largest once all construction phases are completed. IGA becomes the latest Turkish corporation to seek to lower the cost of repaying its debts. Loans have become more expensive to service after a currency crisis last year that sparked a severe economic downturn.

 “The project’s risk structure is not the same as that in the construction period anymore. We’re talking about a very serious economic value,” the company said, according to Reuters.

The airport opened a year ago to much public fanfare. Turkish Airlines, the national carrier, moved its headquarters there at the start of this year.

IGA obtained a 4.5-billion euro loan from banks to build the airport with a 16-year maturity and a four-year grace period on repayment of the principle. IGA later borrowed a further 1 billion euros.

Turkish construction companies Kalyon, Limak, Cengiz and Mapa owns shares in IGA. All enjoy close relations with the Erdoğan government.

Three state-run Turkish banks -- Ziraat Bank, Halkbank and Vakıfbank – as well as private lenders Denizbank, Garanti BBVA and Finansbank, participated in the loan deal.