LG CNS, a leading Korean IT services provider, will move to set up a joint venture or special purpose company with its strategic and financial partners for Greece’s automated public transportation payment system by September this year, the company said Wednesday.
This comes after a consortium, consisting of LG CNS and Greek partners, won a bid to develop and operate the system that would be equivalent to Korea’s automated fare collection system for public transport, including the subway and buses.
The consortium won the deal against France-based Thales and U.S.-based Cubic Transportation Systems consortia in Greece, a market that used to favor Western players, a LG CNS spokesperson said.
|Passengers go through the ticket barriers in a subway station in Greece. (LG CNS)|
“The LG consortium won the bid in a joint effort of not only its partners but also the Korean Embassy in Greece and Cheong Wa Dae,” the spokesperson added.
The Seoul summit between President Park Geun-hye and Greek President Karolos Papoulias in December last year when the two agreed to cooperate on infrastructure development largely paved the way for the deal, he noted.
The SPC hopes to begin developing the system after September this year, with LG CNS focusing on providing its expertise in system integration.
The project, which is worth about 138 million euros ($192 million), includes two years of development and 10 years of operation.
“The involved parties will soon engage in talks over the equity structure of the joint venture and project financing,” the spokesperson said.
The Export-Import Bank of Korea, the state-run policy bank that has been aggressively supporting local companies in global bids, will provide guaranteed financing for LG’s second global project, he added.
“We will also have to discuss whether to develop an auto payment system like Korea, where consumers get a transfer discount depending on the distance traveled via mass transit, or the travel time,” he said.
A LG CNS consortium also won a bid to develop an auto fare payment system in Colombia in 2011.
The company has been eyeing Greece’s mass transportation sector since 2011.
It is currently competing to win a smart transportation card project worth some 1.6 trillion won in London.
By Park Hyong-ki (firstname.lastname@example.org