Arvydas Avulis’ property development company Hanner is taking over Lithuania’s National Stadium project from BaltCap, its current concessionaire and builder, Vilnius Mayor Valdas Benkunskas said on Friday.
“The main news we want to announce is that the BaltCap fund is pulling out of the project and the well-known company Hanner is stepping in,” Benkunskas told a news conference.
“We have an agreement in principle between Hanner and BaltCap on the transfer of shares,” he said. ” A draft document on changing the contract and on indexation will be tabled at the next (municipal) council meeting in February.”
Under the new contract, the project partners – the capital’s municipality and the Education, Science and Sport Ministry – will purchase additional works as the stadium’s seating capacity will be increased from 15,000 to 18,000, and the sports center will be transformed into a multi-purpose arena suitable for cultural and sports events, Benkunskas said.
According to the mayor, this will allow Vilnius to have the largest stadium in the region – bigger than in Kaunas, Riga and Tallinn.
“The competitive environment will definitely improve,” he said.
Benkunskas also said that as part of the contract modification. the payment schedule and financial commitments have been revised to balance and reduce the price indexation and the cost of additional works.
“The contact now says that the city pays the full cost of the construction over 22 years. In this case, the timeframe is being reduced as much as possible, and the 50 million euros earmarked for interest payments will be redirected to compensate for the indexation and additional works,” the mayor said.
“The project will not significantly increase in cost,” he said, adding that “specific figures will be provided in the near future, once we receive approvals from state supervisory authorities.”
The Verslo Zinios business news site has reported recently that BaltCap is looking for another investor for the National Stadium project However, it was not clear whether the investor would take over the whole project or join it as a financial or other partner.
The project started to stall after it became clear that its costs had risen significantly and BaltCap asked its partners to index the construction price.
BaltCap has said on more than one occasion that Sarunas Stepukonis, a former BaltCap Infrastructure Fund partner suspected of gambling away millions of euros of the fund’s money, did not cause any damage to Vilniaus Daugiafunkcis Kompleksas (Vilnius Multifunctional Complex), the company carrying out the stadium project.
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