IFC, a member of the World Bank Group and Saudi Arabia’s General Authority of Civil Aviation (GACA) announced the formal completion of a landmark agreement to build a state-of-the-art airport in Medina.

TIBAH, a consortium composed of TAV Airports, Saudi Oger and Al Rajhi Holdings of Saudi Arabia, alongside the National Commercial Bank, Arab National Bank, and SABB have agreed to provide at least $ 1.1 billion over the next three years to support the development of the Prince Mohammed Bin Abdulaziz International Airport.

It will be the first airport built under a partnership between the government and the private sector in a Gulf Cooperation Council country.

The project, of which IFC is the lead advisor, is expected to spur economic development and help accommodate a growing number of religious pilgrims.

“This financial closure, which has happened on schedule, sets a milestone in GACA’s efforts to include private-sector participation in airports around the kingdom,” said Faisal Al-Sugair, GACA Vice President.

“The project will allow us to welcome a higher number of passengers and considerably improve service levels. We are delighted with the results of this international competitive tender process and look forward to working with our new private sector partners”, he said.

IFC helped the Kingdom of Saudi Arabia carry out an international bidding process that in October 2011 saw the project awarded to a consortium composed of TAV Airports Holding of Turkey in partnership with Saudi Oger and Al Rajhi Holdings of Saudi Arabia. The consortium will develop the airport and operate it over the next 25 years.

“The entire TAV family is deeply honored to be entrusted with the airport of Islam’s second holiest city,” said Sani Sener, President and CEO of TAV Airports Holding.

“This carries with it a great responsibility and we are committed to transforming Medina airport into one of the best international airports in the region.”