The challenge
The Beitbridge border post is the busiest border post in Southern Africa, which not only connects South Africa to Zimbabwe, but is a key access point to trade with countries further to the north. However, owing to the aging infrastructure, significant waiting periods hampered thoroughfare through the border, slowing trade across Southern Africa and causing haulage operators to use longer alternative routes.
The RMB solution
RMB provided an end-to-end infrastructure finance solution for the private sector concessionaire. The concession structure includes the upgrade and modernisation of the border post and the building of a number of social projects for the town of Beitbridge. These include a fire station, residential building units, housing sewer lines, housing electrical supply lines, a reservoir, water pipelines to the reservoir, waste water treatment plant and a water pump station.
RMB has walked the full journey with its client to deliver a substantial regional infrastructure project, despite challenging circumstances both locally and globally. RMB played a number of roles across the transaction as financial and hedging adviser to the project company, mandated lead arranger, senior commercial lender and hedging bank. Through innovative structuring and the ability to tailor bespoke solutions, RMB delivered an optimal financing structure, allowing the concessionaire to deliver this landmark transaction for Zimbabwe and the region.
Proven client results
The redevelopment and upgrade of the Beitbridge border post is a catalyst for increasing trade in the Southern African region and reducing the associated costs to stimulate economic growth and increase revenue to the Zimbabwean government. The Concession Agreement also ensured that the quality of life will be improved for the surrounding Beitbridge town through a number of social development projects.
This is the first concession concluded in Zimbabwe in the last decade and shows great progress in attracting foreign direct investment. This deal comes at a time where infrastructure development through concessions and PPPs is more critical than ever to stimulate economic growth and contribute to the Zimbabwean fiscus and the regional economy.
| Client | Zimborders |
|---|---|
| Deal value | $300-m |
| Sector | Infrastructure and renewables |
| Capabilities | PPPs and concessions for infrastructure development, infrastructure finance |
| RMB's role | Sole financial adviser to project company, hedge adviser, ECA arranger, hedging bank, lender |
| Country | South Africa and Zimbabwe |