Nature of the asset
The Baekyang Tunnel is a 2.3 km, dual two-lane toll tunnel that runs underneath Baekyang Mountain in Busan Metropolitan City, providing a link between the Busan central business district and Busan port and the northern and western residential areas as well as Kimhae International Airport. The tunnel forms part of the route from Busan port to the main expressways leading north and west of Busan such as the Namhae Expressway and the New Daegu-Busan Expressway. Construction of the Baekyang Tunnel began in July 1993 and was completed in January 1998. The tunnel has been in operation since January 2000.
Nature of the investment
MKIF has invested in Baekyang Tunnel Ltd. (“BYTL”), the concessionaire of Baekyang Tunnel, in the form of equity and senior loans. MKIF has 100% of the equity and 1.7% of the total secured senior debt raised by BYTL. MKIF’s total investment to BYTL is KRW2.9 billion.
Concession agreement
| Government authority: | Busan City Government |
|---|---|
| Concession term: | 25 years (15 years remaining) |
| Guarantee duration: | 25 years |
| Concession term commencement: | January 2000 |
| Minimum Guarantee: | 90% of annual CA projected revenue |
| Revenue Cap: | 110% of annual CA projected revenue |
Facilities
| Length: | 2.3 km |
|---|---|
| Capacity: | 4 lanes in both directions |
| Toll rate: | KRW 800 - Small vehicles |
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