IFC Advisory Services Provide for fee advisory services to governments for PSP and PPP transactionsProvide for fee advisory services to governments for PSP and PPP transactions Focus on Infrastructure in recent years… broadly based Africa. SE Asia, LAC, SECA,Focus on Infrastructure in recent years… broadly based Africa. SE Asia, LAC, SECA, Power, telecom, ports, water, airlines, rural electrification, airports, private provision of public healthcarePower, telecom, ports, water, airlines, rural electrification, airports, private provision of public healthcare

The way we operate….. Core IFC teams supplemented by teams of consultants including lawyers, engineers, regulatory specialists, accountants, economists,Core IFC teams supplemented by teams of consultants including lawyers, engineers, regulatory specialists, accountants, economists, months.. Two stages.. Due diligence and strategic stage.. Implementation months.. Two stages.. Due diligence and strategic stage.. Implementation. Fees heavily back-end loaded… donor funds to pay balance of the tea,Fees heavily back-end loaded… donor funds to pay balance of the tea,

Port of Toamasina  Principal port of Madagascar  Accounts for 90% of containerised trade  1992 to 2004: traffic has increased from 26,500 TEU to 91,900 TEU  Until Aug. 2005: one of the worst performing ports in Africa (ie. 7 movements per hour compared to a regional avg. of movements per hour)

Transaction Calendar Strategic Options Prequalification Investors Due Diligence & Negociation of Bidding Documents Bid May 26, 2005 Closing of transact ion Mobilisation of IFC Team Due diligence (legal, technical, social, financial, and accounting ) Expression of Interest January 2004 Spring 2005 Summer 2005 Diagnostic PhaseImplementation Phase Information Memor a ndum Summer 2004 Winter

Port of Toamasina  Hutchinson Port Holdings Ltd.: #1 global container terminal operator (44 million TEU in 2004)  AP Moller Finances S.A. : # 3 global container terminal operator (22 million TEU in 2004)  International Container Terminal Services Inc. : # 7 global container terminal operator (1.9 million TEU in 2004) – Highest Bidder  Consortium of Malta Freeport – CMA CGM – Bolloré : Malta Freeport one of the leading transhipment ports in the Mediterrenean (1.3 millions TEU in 2004)

Transaction Structure  20 years Concession guided by performance objectives  Exclusivity of container terminal operations until level of 400,000 TEU.  Concession entry fee: Initial payment of 5 million Euros by selected operator towards (i) operating budget of Port Authority (SPAT), (ii) purchase of equipment from Port, and (iii) reimburse Government’s transaction development cost  Additional 5 million Euros to be paid by the operatorduring the first 3 years for container cranes  Mandatory rehabilitation and construction works (est. 10 million Euros)  Mandatory capitalisation of project company with minimal equity amount of 5 million Euros

Transaction Structure  Hybrid concession fee: Fixed fee + Variable Fee (Euros per TEU)  Variable fee was the single financial bidding criteria  Expected returns to Madagascar over the life of the concession: efficiency gains, international best practices, investments.  Estimated financial returns to the Government in excess of US$ 300 million in investments, entry and concession fees.

Donor Support for Transaction  DevCo – funding from the UK’s Department for International Development (DIFD), the Dutch Ministry of Foreign Affairs and the Swedish International Development Agency (SIDA) for specialized consultants:  Technical: Hamburg Port Consulting (Germany)  Legal: White & Case (France)  Social: FTHM (Madagascar)  Audit: Delta Deloitte (Madagascar)  the Private Infrastructure Development Group's (PIDG) Technical Assistance Fund - for insitutional capacity building for Port Authority and within Ministry of Transports of Madagascar