Regie de distribution d'Eau & d'Electricite de Rabat-Sale (Redal),a subsidiary of France's Veolia Environnement,has signed an agreement for a Eur 220 million ($268.2 million) loan to finance a four-year development programme. Six local banks extended the 15-year paper, with Banque Marocaine pour le Commerce& l'Industrie (BMCI)and Banque Marocaine du Commerce Exterieure (BMCE) acting as mandated lead arrangers.
The funds will be used to build two wastewater treatment plants and associated pipelines as part of a programme to improve the capital's sewerage systems. Future loan financing is expected to fund an expansion of the sewerage network, the construction of water reservoirs and the installation of new transformers. 'With a population growth rate of 7 per cent, we have to invest in the network if we are to meet demand,' Redal director Guillaume Gilles told MEED. 'We are not yet profitable, but we still have 24 years to go on the concession. We hope to start seeing a return on our investment within the next two years.' Redal won the 30-year Rabat-Sale utilities concession in May 1998. The project called for a total investment of $1,370 million in the refuse collection and power, water and wastewater systems of the Greater Rabat area, which has around 1.7 million inhabitants (MEED 22:5:98). The utility was originally formed by Spain's Dragados, Electricidad de Portugal (EDP), Portuguese investment bank Pleiadeand local engineering company Alborada, before it was bought out by Veolia - formerly known as Vivendi Environnement - in 2002 for MD 800 million ($88.8 million). Veolia also owns Amendis, which provides drinking water, wastewater and electricity services in the Tangier and Tetouan area.