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SubscribeCuatrecasas has advised Concesión Túnel Aburrá Oriente—subsidiary of Odinsa—on obtaining financing worth COP 1.8 billion for debt refinancing and to build the second stage of Conexión Túnel de Oriente (“the Project”), a project that positively impacts regional connectivity and significantly contributes to sustainable infrastructure development in Colombia.
In its first stage, the Project involved building 24 km of infrastructure, including tunnels, viaducts and highway interchanges. In 2019, the Santa Elena tunnel was established and is now the second largest tunnel in Latin America, measuring 8.2 km. Meanwhile, the second stage comprises of (i) coating, paving and installing electromechanical equipment in the Santa Elena tunnel 2—the evacuation tunnel, also measuring 8.2 km—(ii) digging and building the Seminario tunnel (measuring 780 m), and (iii) implementing 4.5 km of viaducts and open-air roads.
This financial closure is a significant milestone for the Project because it enables all the work to be carried out in the second stage, connecting Valle de Aburrá to Valle de San Nicolás and their municipalities. This creates an average transit time of 20 minutes which is 55% less time than via traditional routes. Currently, the Project is 12% complete and construction is expected to take 3.5 years, generating over 2,000 jobs.
Manuel Quinche, managing partner of the Cuatrecasas Bogotá office, commented on the transaction: “The Oriente tunnel is an icon of Colombian engineering. This financing, advised by Cuatrecasas, reached a demand close to double the amount required, which confirms the confidence Colombian banks have in supporting projects that transform regions and connect opportunities.”
Time optimization
The resources for refinancing the existing debt from the first stage and financing the second stage were granted by Bancolombia, Banco Davivienda, Banco de Bogotá, Banco de Occidente, Banco Popular, and the National Development Finance (NDF). The transaction was structured under Colombian banks’ highest standards.
Natalia Arango, partner in the Cuatrecasas Bogotá Finance Practice, also commented on the transaction: “For Cuatrecasas, it has been a pleasure participating in financing this megaproject that integrates multiple tunnels and viaducts and is a benchmark for the whole country and region. We congratulate Concesión Túnel Aburrá de Oriente and Odinsa for leading this financial closure that makes building the second phase of the Project viable. The connection between Medillín and Rionegro continues to improve, optimizing travel times even more.”
The Cuatrecasas advisory team was led by partners Manuel Quinche and Natalia Arango, along with lawyers Laura Valencia, Simón Escobar and Valentina Aldana (Finance); Ana María Sánchez and Andrés Martínez (Infrastructure); and Mateo Benjumea and Maria Camila Solano (Corporate and M&A).Don’t miss our content
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