The Government of St.Petersburg awards the NCH consortium led by VTB Capital the preferred bidder status in the PPP tender for the construction of the central section of WHSD

9 August 2011
Northern Capital Highway (NCH) consortium has been named the preferred bidder in the tender for the right to construct the central part of the Western High-Speed Diameter (WHSD) and subsequently operate the entire stretch of the toll road. The consortium is comprised of VTB Capital, Gazprombank and international construction companies Astaldi (Italy) and Ictas Insaat (Turkey). WHSD is a strategically important investment project both for the city and the Russian Federation that will determine St. Petersburg’s development as a major international transport hub and will create the first toll road operated within city limits in Russia. Today, WHSD is the largest project in Russia implemented within the framework of the public-private partnership mechanism.

NCH’s bid proposes a minimal WHSD toll revenue guarantee by the city of St Petersburg of RUR 9.67bn per annum. Should the actual project revenue exceed this amount, NCH will pay 90% of the excess to the city. It is expected that following the construction of the central part of the road, toll revenues from the Western High-Speed Diameter traffic will soon reach the level of the minimal revenue guarantee, which means that the city will not have to allocate significant funds from its budget to support the project. The level of the minimal revenue guarantee proposed by NCH was significantly lower than that proposed by its competitor enabling significant budget savings.

WHSD’s central section is the most technically complex to build part of the road and includes three bridges (among them two cable stayed) and a tunnel. The expected investment is estimated by NCH at approximately RUR 120bn (€3bn) and will be financed through a combination of debt and equity, as well as the federal grant of approximately RUR 51bn. The consortium has already received debt financing proposal from VTB and Gazprombank (the second and the third largest banks in Russia). NCH is expecting to sign the public private partnership agreement with St Petersburg in December 2011.

Infrastructure investment is one of VTB Capital’s strategic priorities. The implementation of the Western High-Speed Diameter project is in line with VTB Capital’s plans to develop infrastructure projects in Russia utilizing public-private partnership mechanisms. VTB Capital is also the lead investor in the Northern Capital Gateway consortium which has won the right to modernize and operate the Pukovo airport in St. Petersburg. The Pulkovo airport PPP transaction has been recognized by a number of awards from leading international industrial publications including the Infrastructure Journal, the Infrastructure Investor and Euromoney, as well as the award for the best global public-private partnership project of the year.

VTB Capital also acted as the arranger of a successful RUR 10 bn issue of the OJSC “Western High-Speed Diameter” 20-year RUR bonds. The deal saw significant level of investor demand providing an attractive coupon rate for the issuer. Proceeds of this bond issue, alongside financing from the city’s budget and federal subsidies will be used to finalise the construction of the highway’s southern and northern sections.

Oleg Pankratov, Co-Head of Global Banking, Head of Infrastructure Capital & Project Finance at VTB Capital and the Chairman of the NCH Board, said: “We are very pleased with the outcome of the tender and that the proposal of the Northern Capital Highway consortium was recognised as the optimal for the city of St. Petersburg. This is a further step in strengthening VTB and VTB Capital’s leading position in the infrastructure investment market in Russia. To implement the project we have brought the best expertise available. We are convinced that our consortium has the unique experience of successfully implementing large-scale infrastructure projects as well as raising the required financing.”

Press office

Head of Press
Natalia Cherepova
Corporate Communications VTB Capital

The information and opinions contained within VTB Capital research reports are prepared by research analysts associated with JSC VTB Capital, VTB Capital plc and their non-U.S. affiliates (each such entity, a “VTB Group entity,” and all such entities collectively, the “VTB Group”). The information, analytic tools, and/or models referenced herein (and any reports or results derived from their use) are intended for informational purposes only. VTB Capital has no obligation to update this information and may cease provision of this information at any time and without notice. The information and opinions described herein may be based on VTB Capital research reports that have already been published and made available to research customers. Accordingly, members or clients of the VTB Group may have acted upon or used the information or conclusions contained in this research report, or the research or analysis on which they are based, before its publication.


This material does not constitute nor is it intended as an offer, inducement, promotion or solicitation for the purchase or sale of securities, investments or other financial instruments. Neither the information contained in the report nor any future information made available with the subject matter contained in the report will form the basis of any contract. This material is not intended to constitute an investment recommendation as defined by Article 3(1) (35) of Regulation (EU) No 596/2014, and related rules and regulations (each as amended). VTB Capital is not acting as a fiduciary. VTB Capital does not provide, and has not provided, any investment advice or personal recommendation to you in relation to any transaction and/or any related securities described herein and is not responsible for providing or arranging for the provision of any general financial, strategic or specialist advice, including legal, regulatory, accounting, model auditing or taxation advice or services or any other services in relation to the transaction and/or any related securities described herein. Accordingly, VTB Capital is under no obligation to, and shall not, determine the suitability for you of any transaction described herein. You must determine, on your own behalf or through independent professional advice, the merits, terms, conditions and risks of any transaction described herein. Any reference to past performance of securities or other financial instruments is for informational purposes only and does not imply or indicate future results.


VTB Group entities do and seek to do business with companies referenced in research reports. Thus, investors should be aware that the VTB Group may have a conflict of interest that could affect the objectivity of this research report. Disclosures on the companies referenced in this report can be obtained by accessing the following webpages:

Research disclosures webpage -

Investment Recommendations disclosures webpage


Whilst every care has been taken in preparing the reports, no research analyst, director, officer, employee, agent or adviser of any member of the VTB Group gives or makes any representation, warranty or undertaking, whether express or implied, and accepts no responsibility or liability as to the reliability, accuracy or completeness of the information set out in the reports. Any responsibility or liability for any information contained in the reports is expressly disclaimed. All information contained in the reports is subject to change at any time without notice. No member of the VTB Group has an obligation to update, modify or amend the reports or to otherwise notify a reader thereof in the event that any matter stated in the reports, or any opinion, projection, forecast or estimate set forth in the reports, changes or subsequently becomes inaccurate, or if research on the subject company is withdrawn.

In the United Kingdom, the reports are approved and/or communicated by VTB Capital plc, a bank authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. The reports are intended for those persons that would be classified as eligible counterparties or professional clients under the Financial Conduct Authority’s Conduct of Business rules. The reports have been made publicly available, and as such, constitute an ‘acceptable minor non-monetary benefit’ pursuant to Article 12(2) Commission Delegated Directive (EU) 2017/593 (as implemented into United Kingdom domestic law and regulation following the United Kingdom’s departure from the European Union). The reports do not intend to communicate an invitation or inducement to engage in investment activity, and as such do not fall within the definition of a Financial Promotion as per s.21 of the Financial Services and Markets Act 2000 (FSMA), and related rules and regulations (each as amended).

Reports are distributed in the European Economic Area (EEA) by VTB Bank (Europe) SE, registered with the number HRB 12169 at the register of companies in Frankfurt am Main and authorised by the Bundesanstalt fur Finanzdienstleistungsaufsicht (Federal Financial Supervisory Authority), Graurheindorfer Strasse 108, 53117 Bonn, Marie-Curie-Strasse 24-28, 60439 Frankfurt am Main and the European Central Bank, Sonnemannstrasse 20, 60314 Frankfurt am Main to provide banking transactions and financial services. Reports are intended for those persons classified as Eligible Counterparties or Professional Clients pursuant to Directive 2014/65/EU. In the United States, these reports are intended for persons who are considered ‘institutional investors’ as defined by FINRA Rule 2210(a)(4).

In Singapore, the reports are distributed by VTB Capital plc to accredited investors, expert investors or institutional investors only (as defined in the applicable Singapore laws and regulations and are not intended to be distributed directly or indirectly to any other class of person). Recipients of these reports in Singapore are to contact VTB Capital plc, Singapore branch in respect of any matters arising from, or in connection with, this report. VTB Capital plc, Singapore branch is regulated by the Monetary Authority of Singapore.

In Hong Kong, the reports are distributed by VTB Capital Hong Kong Limited, a licensed corporation (CE Ref: AXF967) licensed by the Hong Kong Securities and Futures Commission to “professional investors” (as defined in the Hong Kong Securities and Futures Ordinance and its subsidiary legislation) only.

In Russia, the reports are approved and/or communicated by JSC VTB Capital, a professional securities market participant regulated by the Central Bank of Russia. VTB Capital is not providing either investment advice or individual investment recommendations to the recipients of the reports or any other persons either under Federal Law On Securities Market of 22.04.1996 No. 39-FZ (or related rules and regulations, each as amended) or otherwise. These reports are not advertising as defined in Russian legislation, but are information and analysis not having product promotion as their main purpose and do not provide appraisal within the meaning of the Russian legislation on appraisal activity. Research reports do not constitute a personalised investment recommendation as defined in Russian laws and regulations, are not addressed to a specific client, and are prepared without analysing the financial circumstances, investment profiles or risk profiles of clients.


The reports are being furnished to certain persons as permitted by applicable law, and accordingly may not be reproduced or circulated to any other person without the prior written consent of a member of the VTB Group. Unauthorised use or disclosure of the reports is strictly prohibited.

By clicking ‘Confirm’ you attest that you are either a professional investor or eligible counterparty and agree to our terms of access as described above. If you are not considered to be a professional investor or eligible counterparty, please click ‘Decline’ and you will be reverted back to the VTB Capital website.