What we delivered

  • A new, fourth, underground line for the Milan metro system

  • Provided risk assessment and other due diligence to the financing of this major transportation project for Italy’s second-biggest city

  • Oversaw construction on the part of the lenders for the project

Services used
Business and investor advisory

Get in touch with our team

Milan’s fourth underground line, opened in 2022, is an integral part of the city’s journey towards sustainable growth and a more integrated, resilient mass transit network.

Connecting the south-western district of Lorenteggio/San Cristoforo with Linate Airport on the east, the new 15-kilometre M4 line is a key transport corridor for the country´s financial capital. Arup was appointed to provide Lenders Technical Advisory (LTA) services to the banking syndicate launched to finance this project, helping them assess the project’s overall risk profile.  

Combining our commercial and operational know-how with specialist engineering skills, our infrastructure advisors provided detailed due diligence, together with complex, multi-disciplinary service contracts guidance, as well as monitoring services to the lending group. Besides providing technical Due Diligence services on the project, we also worked closely with the legal advisor, the sponsor and the lenders in shaping the project contracts; in particular the Engineering, Procurement & Construction (EPC) and the Operation & Maintenance (O&M) contracts. 

Through our design expertise, an established track record managing large infrastructure projects and know-how on project financing contracts and service provision standards, our consultants helped the financial institutions deliver a bankable arrangement that provides value for money for the city. Milan is the second most populated city in Italy with more than 3 million residents in the metropolitan area, and this new line significantly strengthens its public transportation system. 

Angelo Colombo

Head of Infrastructure financing, Unicredit Bank on behalf of the Lenders

Providing financial expertise

We drove the inclusion of a series of protection mechanisms for the Lenders in the EPC contract based on critical construction milestones and, given the complexity of the project, an increase in project contingency to a value acceptable to all parties, and protective of the project success. 

Our consultants also drew from years of international experience to deliver solid contractual and operational arrangements of the complex SPV structure. Through extensive discussions, simulations and thorough reviews of all project elements, we were able to support the syndicate of banks to get a better read of project risks, and successfully getting the project through their credit committees. 

Assessing programme overrun risks was another key piece of work, helping frame contract arrangements for delays and extra costs; or dealing with budget overruns. We also oversaw construction on behalf of the lenders, providing monitoring insight into the evolution of project risks and relevant mitigation measures to implement.