Project Model

Sarıyer-Kilyos Tunnel Project (“Kilyos Project”), which is a part of Northern Marmara Motorway Odayeri-Paşaköy (including Third Bosphorus Bridge) Section (“Original Project”), represents a landmark tunnel project in Türkiye, with a build-operate-transfer (“BOT”) model under the “Law No. 3996 on the Realisation of Certain Investments and Services through the BOT Model” dated 8 June 1994. The tunnel which is designed to be approximately 6,8 kilometres long and the Project is expected to be completed in May 2026.

Unique Features of the Project

The Kilyos Project has unique features among the precedent transportation sector BOT projects in Türkiye.

Firstly, it is the first motorway BOT project in Türkiye which was financed through bond issuance. The project bonds were issued in the Luxembourg Stock Exchange by ICA İçtaş Altyapı Yavuz Sultan Selim Köprüsü ve Kuzey Çevre Otoyolu Yatırım ve İşletme A.Ş., a subsidiary of IC Holding A.Ş.

Secondly, the Project has a unique feature of involving a contractual structure where one single Implementation Contract governs both the Original Project and the Kilyos Project, whereas there are separate Implementation Contract Direct Agreements and separate Debt Assumption Agreements for each project.

Debt Assumption Undertaking

Debt assumption fundamentally refers to the assumption of the loan and financing costs by the relevant public entity on behalf of the State upon termination of the underlying concession agreement (i.e, the implementation contract in motorway projects) regardless of the reason of the termination.

Similar to the Original Project, the Kilyos Project also benefited from a debt assumption undertaking given by the Ministry of Treasury and Finance of Republic of Türkiye (“Turkish Treasury”).

Financing

Kilyos Project was financed through project bonds, which were issued in the Luxembourg Stock Exchange by ICA İçtaş Altyapı Yavuz Sultan Selim Köprüsü ve Kuzey Çevre Otoyolu Yatırım ve İşletme A.Ş., a subsidiary of IC Holding A.Ş., a major player in infrastructure investment and operation in Türkiye. J.P. Morgan Securities plc acted as the Initial Purchaser and BNY Mellon Corporate Trustee Services Limited acted as the Trustee and the Security Agent in relation to the financing of the Project.

The bonds attracted significant interest from both domestic and international institutional investors, including leading global infrastructure companies, funds, pension funds, and development finance institutions.

The Project won the “PPP Deal of the Year” Award at the IJ Global Awards 2025 and “Bond Deal of the Year” Award at 9th PPP Week Awards 2025.

Ergün represented J.P. Morgan as the Initial Purchaser on this landmark deal.

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