Istanbul Ferries Privatisation



Project number:


Business sector:

Municipal and environmental infrastructure

Notice type:


Environmental category:


Approval date:

26 Jul 2011



PSD disclosed:

21 Apr 2011

Translated version of this PSD: Turkish

Project Description

On 8 April 2011 the Consortium composed of Akfen, Tepe Insaat, Souter Investments LLP and Sera Gayrimenkul won a privatisation auction organised by Istanbul Metropolitan Municipality to sell Istanbul Deniz Otobusleri A.S.(IDO), a municipal ferry operator providing inter and inner city services across the Bosphorus and the Marmara Sea.

EBRD is considering to provide financing for the acquisition which will assist in increasing private sector participation in the public transport sector in Turkey.

Transition Impact

The Project is consistent with the Bank’s Municipal and Environmental Operations Policy as it supports private sector participation. The Project is consistent with the Bank’s Strategy for Turkey to support private sector involvement in infrastructure. It will be the first EBRD project with a private operator in the public transport sector in Turkey.

The transition impact of the project derives from supporting the privatisation of a municipal maritime transport operator and the demonstration effect of restructuring of services through the introduction of new ticketing classes, new routes and services, restructuring of the route network, ancillary retail in terminals and on ships, such as expanded retail offerings, and catering.

Specifically, the project transition impact will result from the following:

(i) private sector participation – the project finances the privatisation of a key service offered to the residents of Istanbul and the Marmara region, through the transfer of a formally municipal budget entity to a private company on a self-financing basis;
(ii) demonstration effect – once implemented, the project demonstrates a successful privatisation process, which should lead to the opportunity to make improvements to service quality, management efficiency and other marketing innovations, while ensuring safety of operations.


The Client

A special purpose company (the “SPV”) to be established for the purposes of operating ferries in the Istanbul area by a consortium composed of: 30 per cent Akfen Holding Anonim Sirketi (“Akfen” – Turkey), 30 per cent Tepe Insaat (“Tepe” – Turkey), 30 per cent Souter Investments LLP (“Souter” – UK) and 10 per cent Sera Gayrimenkul (“Sera” – Turkey).

EBRD Finance

EBRD is considering two loans to the SPV and IDO on a joint and several basis to finance the Project including refinancing, in the amount of up to USD 150 million including:

1. An EBRD senior secured long-term loan of up to USD 100 million, and
2. An EBRD subordinated medium term loan of up to USD 50 million.

The EBRD loans will be co-financed with parallel loans from a syndicate of Turkish commercial banks for a total amount of up to USD 600 million.

Project Cost

USD 861 million (acquisition price).

Environmental Impact

Categorised B. Environmental and social (E&S) issues associated with the project are readily identified and addressed through mitigation measures.

Environmental and social due diligence (ESDD) has been carried out based on EHS Questionnaires completed by IDO, and a site visit and discussions with IDO’s management by the Bank’s environmental specialist. The information obtained has allowed for a corporate environmental and social review of IDO focusing on its current assets, operations, management systems and regulatory compliance status; review of the E&S policies and management capacity of the newly established SPV; and E&S review of selected terminals and ferry operations.

The ESDD did not identify any significant issues of concern related to the operations of IDO. It has a well designed quality, environmental, health and safety (QEHS) management system in place and a clear organisational structure that designates specific personnel, including management representative(s), with clear lines of responsibility and authority. Management support and human and financial resources have been committed on an ongoing basis to achieving effective and continuous social and environmental performance.

The ESDD identified a number of deficiencies from the Bank's requirements related to labour and working conditions. These mainly relate to work contracts, the relatively low number of female employees, working conditions and rights of contractor employees. Corrective measures to address these issues have been included in the Environmental and Social Action Plan (ESAP).

The ESAP has been developed for the SPV to allow for achieving compliance with the Bank’s PRs through the implementation of the following measures:

- Maintain the management systems and compliance of all fleet with international maritime safety and environmental standards (including IMO MARPOL and SOLAS)
- Define Company corporate policy and procedures for mitigating any adverse impacts caused by tariff increases.
- Review of the issues related to labour, including work contracts, working conditions, the rights of contractor employees, and grievance mechanisms and the implementation of any necessary corrective actions.
- Carry out a soil investigation programme to identify any potential soil contamination issues at fuel storage and refuelling facilities.
- Adopt a GHG accounting and reporting system
- Ensure that the environmental and social assessment for any projects considered for Ambarli will be carried out in accordance with the Turkish regulatory requirements and the EBRD PRs, and develop both a “Land Acquisition Procedure” for managing the land acquisition and associated compensation process and a “Chance Find Procedure” for protecting archaeological property in the event of new terminals being constructed in the future.

The SPV will provide the Bank with Annual Environmental and Social Reports and notify on any material accidents or incidents. The Bank will evaluate the Project’s environmental and social performance in accordance with the Bank’s PR’s through reviewing the SPV reporting and undertake periodic monitoring visits.

Technical Cooperation


Company Contact

Kadri Samsunlu (Akfen Chief Financial Officer)

Tel : +90 (212) 319 87 00
Fax :+90 (212) 319 87 10

Business opportunities

For business opportunities or procurement, contact the client company.

For state-sector projects, visit EBRD Procurement: Tel: +44 20 7338 6794

General enquiries

EBRD project enquiries not related to procurement:
Tel: +44 20 7338 7168

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Text of the PIP

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