Unique Partnership Enables City to Meet Federal Security Guidelines on Time -
With No Long-Term Financial Commitments
DENVER, Colo., Dec. 8 /PRNewswire-FirstCall/ -- The City and County of
Denver and Denver International Airport (DEN) announce that they have
structured a $60 million financing package with Siemens as part of the $74
million contract that Siemens was awarded in June to install and service
inline baggage screening systems. The finance package, offered through
Siemens Financial Services, is designed to help DEN manage cash flow and
initial construction costs, and begin -- and complete -- the project more
quickly. It also enables DEN to avoid the significant cost of issuance
associated with a conventional revenue bond issue. The proceeds of the loan
were placed in escrow with JP Morgan/Chase. It is expected that the loan will
be repaid over five years with the proceeds of the Letter of Intent DEN
received from the Transportation Security Administration.
(Logo: http://www.newscom.com/cgi-bin/prnh/20021029/SILOGO )
DEN is installing new baggage handling systems to comply with federal
security guidelines established in 2002 by the Transportation Security
Administration (TSA), the agency that oversees security for the nation's
transportation systems. The majority of the project will be funded by the TSA
under a multi-year reimbursement program.
"By contracting only with Siemens and building into the installation
project a financing component, the airport could achieve its project goals in
terms of quality, timing and cost," added Stan Koniz, chief financial officer
for DEN. "Siemens understood our concerns -- that we had limited funds and
limited manpower. They developed a financing program that gave us greater
flexibility to do more with fewer resources. Furthermore, the structure put
in place for this deal will allow the financing for future projects with DEN
to be accomplished in an expedient manner."
Siemens Dematic successfully reconfigured the first of six modules in the
Jeppesen Terminal at DEN earlier this year and began designing and installing
the systems in the remaining five modules in September 2003. DEN will have
100 percent compliance with the baggage screening guidelines by the end of
2004, and the entire project will be completed in March 2005.
"With Siemens' experience and resources, we are confident that the upgrade
will continue to be a safe, smooth and seamless transition for our travelers,"
said Edward Currier, assistant deputy manager of Aviation for DEN.
In response to the terrorist attacks of September 11, 2001, Congress
mandated that the nation's commercial airports install Explosive Detection
Systems (EDS) and Explosives Trace Detection (ETD) machines to screen all
checked baggage by the end of the year. Working with the TSA, Siemens,
together with The Boeing Company, installed electronic detection systems at
438 commercial airports. Under this contract, Siemens also continues to help
maintain and operate these devices.
"While Siemens was involved with TSA's national program to install EDS and
ETD machines, we approached the Denver project differently, addressing the
specific requirements and needs of Denver International Airport, the city and
the county," said Bruce McMickle, vice president of Sales, Siemens Dematic,
Airport Baggage Operations. "After demonstrating our capabilities during the
first phase, we put together a proposal for the bulk of the project that would
enable the airport to make the necessary upgrades and manage cash flow
throughout the TSA reimbursement process -- a step that could have delayed the
project for months. We believe this type of offering can provide support to
other airports as they embark on critical infrastructure improvement projects
and are proud to play a role in the effort to make air travel safer."
About Siemens
Siemens AG (NYSE: SI), headquartered in Munich, is a leading global
electronics and engineering company. Siemens and its subsidiaries employ
417,000 people in 192 countries and reported worldwide sales of $80.3 billion
in fiscal 2003 (10/1/02 - 9/30/03). The United States is Siemens' largest
market in the world, with 11 of Siemens' worldwide businesses headquartered
here and annual sales of $16.6 billion in fiscal 2003. The Siemens companies
in the U.S. employ approximately 65,000 people in all 50 states and Puerto
Rico. Corporate headquarters for Siemens' U.S. businesses are located in New
York City. For more information: http://www.usa.siemens.com.
Siemens Financial Services, Inc. is one of Siemens' operating companies in
the U.S. The people of Siemens Financial Services, Inc. (SFS) build
relationships to deliver customized commercial financing solutions. SFS is
led by industry veterans who work to ensure quick, quality financing. With
expertise in Asset-Based Lending, Capital Markets, Equipment Financing,
Commercial Trade Finance and Vendor Financing, each transaction is tailored to
fit the specific borrowing needs of the client.
About Denver International Airport
Denver International Airport, owned by the City and County of Denver,
Colorado, and operated by the Denver Department of Aviation, is the 5th
busiest airport in the United States and the 10th busiest in the world.
DEN handled 35.65 million passengers and 509,229 operations in 2002. As
of late 2003, 23 airlines provided nonstop service from DEN to 133
destinations in the United States, Canada, Mexico and Europe.
DEN's airfield layout -- with none of its six runways intersecting -- and
the distance between concourses contribute to the airport's efficiency. DEN
is consistently ranked by the U.S. Department of Transportation as one of the
least-delayed airports in the nation.
SOURCE Siemens AG
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Related links:
http://www.usa.siemens.com
Photo Notes:http://www.newscom.com/cgi-bin/prnh/20021029/SILOGO
Company News On-Call:
http://www.prnewswire.com/comp/000728.html
CONTACT:
Paula S. Davis of Siemens, +1-212-258-4260,
paula.davis@siemens.com; or Chuck Cannon of Denver International
Airport, +1-303-342-2250, chuck.cannon@diadenver.net, for Siemens
AG
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