French consortium fails to develop international airport

Business Materials 6 May 2017 17:32 (UTC +04:00)

Tehran, Iran, May 6

By Mehdi Sepahvand –- Trend:

A consortium of two French companies that had signed a memorandum of understanding with Iran last year has failed to develop the international Imam Khomeini Airport City (IKAC).

The investment agreement came in seven articles, said IKAC CEO Mahmoud Navidi, adding Iran repealed the contract four months ago when the French side did not keep up, Fars news agency reported May 6.

The development project related to Iranshahr Terminal of the IKAC and the French side had agreed to offering financing and engineering services and more, Navidi said.

He nevertheless added that Iran has held a tender to replace the French consortium, adding currently 50 Iranian and foreign companies have placed bids.

The memorandum of understanding awarding Bouygues BOUY.PA the contract was agreed in January 2016.

The project was hindered by the company's struggle to get financial backing from international banks, which are still wary of US sanctions over their activities in Iran, a spokesman for the French construction group said May 5.

"The MoU is now void but there are still ongoing discussions with Iranian authorities," the Bouygues spokesman said.

Aeroports de Paris ADP.PA, initially Bouygues' partner for the Tehran airport terminal development, said in February it would no longer take part in the project.

France's Vinci SGEF.PA also signed preliminary deals last January to build the extension of Iran's Mashhad and Isfahan airports, the country's second and fifth biggest hubs, and negotiations with Iranian authorities on those are still ongoing.

Iran remains a major potential market for construction firms.