Every year, GTR’s editorial staff selects the market’s Greatest Offers from the earlier 12 months. The profitable offers are chosen from submissions despatched to GTR, and have a mixture of commerce, commodity, provide chain and export finance, in addition to fintech-led transactions. Congratulations to these behind these 15 offers, which had been chosen as the highest transactions from 2019.
The rise and rise of sustainability-linked financing
Leveraging finance to facilitate and assist environmentally and socially sustainable financial exercise was a significant focus for a lot of banks in 2019. Whereas quite a few transactions have been closed throughout a rising variety of sectors, these 4 profitable offers have set the bar for the business with a collection of firsts.
Cofco Worldwide
Deal identify: Cofco Worldwide: sustainability-linked services
Borrower: Cofco Worldwide (HK) Ltd
Quantity: US$2.3bn
Senior bookrunning MLAs: ABN Amro, Agricultural Financial institution of China, ANZ, BBVA, China Building Financial institution, China Improvement Financial institution, ICBC, ING, Natixis, OCBC
Bookrunning MLAs: Financial institution of America Merrill Lynch, Crédit Agricole, Rabobank, Westpac
MLAs: Commonwealth Financial institution of Australia, DBS Financial institution, HSBC, MUFG Financial institution, Société Générale, SMBC, Commonplace Chartered
Co-ordinator: ABN Amro
Sustainability co-ordinators: BBVA, ING, Rabobank
Regulation agency: Clifford Probability
Tenor: 1-year RCF, 3-year RCF and 3-year time period loan
Pricing: Margins primarily based on Cofco’s efficiency towards environmental, social and governance targets
Date signed: July 16, 2019
On this groundbreaking transaction, Chinese language commodity dealer Cofco Worldwide labored with a consortium of over 21 banks to hyperlink its predominant financing to its sustainability efficiency. Structured consistent with the sustainability-linked loan rules, the bumper US$2.3bn financing contains three tranches – a one-year revolving credit score facility (RCF), a three-year RCF and a three-year time period loan – every of which is tied to the assembly of KPIs in areas akin to rising traceability of agri-commodities, with a give attention to instantly sourced soy in Brazil. This deal is the most important sustainability linked loan for a commodity dealer to this point and the primary of its type for a Chinese language firm.
Bunge Europe Finance BV
Deal identify: Bunge: sustainability-linked facility
Borrower: Bunge
Quantity: US$1.75bn
Lively Bookrunners/MLA): ABN Amro, BNP Paribas, HSBC, ING, Natixis, SMBC
Bookrunners/MLAs: ANZ, Financial institution of China, Financial institution of Montreal, BTMU, Citi, Crédit Agricole, Deutsche Financial institution, ICBC, Mizuho, Rabobank, Société Générale, Commonplace Chartered, UniCredit, US Financial institution, Wells Fargo
Sustainability co-ordinators: ABN Amro, BNP Paribas, Natixis, Rabobank
Regulation companies: Clifford Probability; Reed Smith
Tenor: Three years
Pricing: Libor plus between 0.3% and 1.3% on a ratings-based grid. Moreover, the margin will be additional adjusted primarily based on 5 sustainability-linked KPIs which might be examined on an annual foundation
Date signed: December 16, 2019
Over in Europe, a considerably oversubscribed deal for Bunge noticed 41 establishments come collectively to amend and lengthen an current facility and tie its pricing to sustainability goals. The rate of interest on this US$1.75bn, three-year revolving credit score facility is linked to Bunge’s efficiency on greenhouse fuel discount, traceability of agricultural commodities and sustainable practices throughout the soybean and palm provide chain.
The primary sustainable finance transaction for the commodity dealer, this deal exhibits the ability of financing to drive best-in-class value chains which can be clear, verifiably sustainable and which may create a constructive impression on the bottom, making it a transparent winner.
Rusal
Deal identify: Rusal: sustainability-linked facility
Borrower: UC Rusal plc
Quantity: US$1.085bn
Co-ordinating bookrunning MLAs: ING, Natixis
Preliminary bookrunning MLAs: Financial institution of China, Crédit Agricole, Société Générale, UniCredit
Bookrunning MLA: Sberbank
Preliminary MLA: RCB Financial institution
MLAs: Financial institution Zenit, Intesa Sanpaolo
Lead arranger: Raiffeisen Financial institution
Sustainability co-ordinators: Natixis, Société Générale
Regulation companies: Cleary Gottlieb Steen & Hamilton; Clifford Probability
Tenor: 5 years
Pricing: The rate of interest of the PXF is topic to a reduction or premium relying on Rusal’s fulfilment of sustainability-linked KPIs
Date signed: October 29, 2019
Tackling sustainability points within the energy-intensive aluminium smelting enterprise is one factor. Getting a deal over the road simply months after sanctions on the borrower had been lifted deserves an award. Within the first ever syndicated sustainability-linked pre-export finance facility in Russia’s metals and mining sector, 11 banks got here collectively to loan US$1.085bn to aluminium and alumina producer Rusal – up from US$750mn at launch.
The transaction combines a pre-export finance construction with a sustainability-linked function, and consists of KPIs associated to carbon footprint and fluoride emission reductions in addition to gross sales of Rusal’s “green” aluminium model, Permit.
Ghana Cocoa Board (Cocobod)
Deal identify: Cocobod: sustainability-linked facility
Borrower: Ghana Cocoa Board (Cocobod)
Quantity: US$300mn
Bookrunning MLAs: Crédit Agricole, MUFG Financial institution, Natixis, Rabobank, Société Générale
MLAs: DZ Financial institution, Ghana Worldwide Financial institution, Nedbank
Tenor: Three years
Pricing: Preliminary margin of 295bps each year over US$ Libor, features a margin incentive mechanism topic to environmental and social KPIs
Date signed: March 19, 2019
One other “first” got here from Africa, with a US$300mn syndicated sustainability-linked loan facility for Ghana’s Cocobod. The margin on the ability is predicated on Cocobod reaching efficiency targets, from the empowerment of feminine farmers to elevated sensitivity to little one labour amongst group leaders. What put this deal over the road was its far-reaching impression: because the world’s second-largest cocoa producer, modifications led to in Ghana make a tangible distinction alongside the cocoa provide chain, setting a excessive bar for different African commodity producers.
African options for African infrastructure
Deal identify: Ghana Infrastructure Firm (GIC)
Borrower: Ghana Infrastructure Firm Ltd (GIC)
Quantity: US$22.5mn
Lender: Investec Financial institution South Africa
ECA: ECIC South Africa
Regulation Agency: DLA Piper
Tenor: As much as 5 years
Date signed: April 24, 2019
In an export finance market historically centered on bigger offers and blue chip debtors, this transaction is comparatively small, extremely structured and centered on supporting a mid-sized African provider because it grows its enterprise in its house market.
Ghana Infrastructure Firm Ltd (GIC) was final yr bidding to signal contracts with the Ministry of Roads and Highways of Ghana to assemble 5.8km of storm drainage alongside the Lamashiegu, Nalung-Bulpela and Tamale roads. It was additionally seeking to interact within the rehabilitation and reconstruction of 56km of chosen roads inside the Ashanti area in central Ghana.
The corporate wanted a financing construction that allowed it to implement the challenge towards contract receivables from the Ministry of Roads and Highways, with none direct assure from the Ministry of Finance. Regardless of having by no means lent to the corporate beforehand, it was Investec Financial institution South Africa that stepped as much as construction the financing and fund the initiatives. Export credit score company Export Credit score Insurance coverage Company of South Africa supported the financing primarily based on procurement of key items (metal) and providers (design and engineering) from South Africa.
The finance was structured as a provider credit score, which allowed GIC to handle funds and phrases negotiated with the Ministry of Roads and Housing. “Whilst some banks are able to arrange transactions in Ghana where the Ministry of Finance is the borrower, it is less common for the repayment source to be a local contractor relying on line ministry receivables,” a spokesperson for the financial institution tells GTR.
The deal enabled GIC to not solely win the work, but in addition preserve a excessive stage of localisation of jobs in Ghana and develop GIC’s and Ghana’s capability to ship such initiatives domestically.
“Local contractors such as GIC are often viewed as potential sub-contractors to foreign contractors in export credit transactions. In this case GIC was the lead contractor who set up an African supply chain to implement it,” Investec says in its awards submission.
Supporting the world’s latest nation’s export technique
Deal identify: Authorities of South Sudan
Borrower: Authorities of South Sudan
Quantity: US$400mn
Lender: African Export-Import Financial institution
Regulation agency: Hogan Lovells
Tenor: four years
Date signed: October 2019
Having signed a peace deal in 2018 following 5 years of civil battle, the Republic of South Sudan is now prioritising the enlargement of its commerce and inward funding flows in a bid to revive its economic system.
The world’s youngest nation, unbiased since 2011, has overwhelming endowments in oil, which account for 95% of export earnings. Additionally it is sturdy in non-oil sectors, together with round 16 mineral deposits akin to gold and iron ore – though mining operations have but to start – in addition to gum arabic, of which it produces 10% of worldwide output. It additionally has nice prospects for the expansion of agriculture owing to ample arable land across the Nile basin.
On this profitable deal, the federal government of South Sudan, which to this point has obtained little monetary intermediation, turned to the African Export-Import Financial institution (Afreximbank) to help with a broad-based facility that may, amongst different issues, present financing for pressing infrastructure upkeep in addition to improvement.
The financial institution supplied the federal government with an amortising US$400mn resource-backed time period loan in assist of assorted infrastructure initiatives to speed up diversification of the nation’s economic system. The financing was availed towards future receivables of crude oil exports. Afreximbank offshored its threat by project agreements entered into with worldwide offtakers who pay by letters of credit score issued by worldwide banks.
“The objectives of the facility are to help create an enabling environment for expansion of trade and investment and accelerate export diversification through the exploitation of non-oil sectors, all of which will build confidence as well as support sustainable development in the country,” says Kanayo Awani, managing director of Afreximbank’s Intra-African Commerce Initiative.
She explains that speedy consideration might be turned to financing the completion of a world airport. Additionally earmarked for the financing are key roads linking the nation to its regional buying and selling neighbours, in addition to the event of a photo voltaic and battery energy plant. “Drawdowns are ongoing. Most of the projects required significant downpayments for contractors or service providers to mobilise,” explains Awani.
Voltron proves interoperability potential
Deal identify: Landmark Group
Borrower: Landmark Group
Issuing financial institution: HSBC
Lender: HSBC UAE
Date signed: June 2019
Interoperability between blockchain platforms has lengthy been a priority for banks and different gamers in commerce finance, who fear that they might pump cash into an initiative, solely to seek out out that it could actually’t hyperlink up with different platforms.
This profitable deal noticed HSBC and the UAE-based retail conglomerate Landmark Group construct a blockchain-based provide chain platform known as ReChainME, earlier than finishing up two stay pilots that related it with the Voltron blockchain initiative.
It was the primary time that Voltron – which has since rebranded as Contour and was run by a bunch of eight banks, together with HSBC, on the time – related with one other blockchain platform and demonstrated its potential for interoperability.
HSBC issued a letter of credit score (LC) on Voltron for the cargo of products from producer Bee Dee in Hong Kong to Babyshop, Landmark Group’s household retail model within the UAE. By interoperating with ReChainME, information and paperwork had been exchanged seamlessly.
HSBC says that the usage of blockchain meant that much less paper was used, but in addition led to a 40% discount within the total transaction time. In the meantime related prices had been minimize by the convergence of the monetary and bodily provide chains.
Chatting with GTR in regards to the transaction on the time it was signed, Sunil Veetil, HSBC’s regional head of commerce for the Center East, North Africa and Turkey, mentioned: “We have the problem that there are many blockchain platforms now and they are not interoperable, so it is creating digital islands. It has raised the question of how they are going to talk to each other. What we proved here is that not only could we link the physical and financial aspects of the supply chain, but also create the technical link between separate platforms.”
Swiss ECA backs first waste-to-energy plant in Istanbul
Deal identify: Municipality of Istanbul waste-to-energy plant
Borrower: Municipality of Istanbul
Quantity: €320mn
Mandated lead arranger: BNP Paribas
Lenders: Black Sea Commerce Improvement Financial institution, Société Générale
Regulation agency: Baker McKenzie
Tenor: 13 years (Serv-covered loan) and seven years (tied business loan)
Date signed: November 2019
Whereas waste-to-energy vegetation aren’t classed as wholly renewable, services which burn non-recyclable waste to create energy are usually perceived as being extra environmentally pleasant than merely sending the garbage to landfill.
In concept, waste-to-energy vegetation ought to produce decrease CO2 emissions whereas additionally contributing to the round economic system.
On this profitable export finance deal, by which the municipality of Istanbul borrowed €320mn to construct such a plant, the scale and site of the challenge stood out.
In accordance with the deal submission, this would be the first waste-to-energy plant within the metropolis and would be the largest in Europe, with Japanese industrial and engineering company Hitachi Zosen, which helps assemble the ability, telling GTR that the plant will course of 1 million tonnes of waste a yr when it will get getting in 2021. It says this might be greater than some other facility of its type on the continent.
This was additionally the primary transaction the Swiss export credit score company (ECA) Serv had signed with the Istanbul municipality, in what was an election yr within the metropolis.
BNP Paribas and Société Générale supplied €200mn as a part of the Serv-covered facility, with the ECA supplying assist through 95% political and business threat cowl. BNP Paribas acted as mandated lead arranger and Serv as facility agent.
In a separate business facility, Société Générale acted because the agent, offering €120mn alongside BNP Paribas and the Black Sea Commerce Improvement Financial institution.
The construction of the deal, in the meantime, will see the municipality of Istanbul reimbursed primarily based on the invoices already paid to the enterprise partnership of Mak-Yol and Hitachi, the 2 companies chosen to construct the plant.
Shoring up finance for espresso farmers
Deal identify: NKG smallholder finance
Borrower: Neumann Kaffee Groupe (NKG)
Quantity: US$25mn
Mandated lead arranger, facility agent and structuring financial institution: ABN Amro
Lenders: BNP Paribas, Rabobank
Insurers: IDH – The Sustainable Commerce Initiative, USAID
Regulation agency: Clifford Probability
Tenor: As much as 10 years
Date signed: July 8, 2019
Smallholder farmers in rising markets proceed to wrestle to entry finance. This 10-year US$25mn revolving credit score facility will present loans by espresso service group Neumann Kaffee Gruppe (NKG) to smallholder espresso farmers most in want.
NKG will present loans through the NKG Bloom initiative to its native entities, which can then on-lend to espresso farmers and co-operatives in rising markets together with Uganda, Kenya, Tanzania, Costa Rica, Honduras, Mexico, Peru, India, Indonesia and Vietnam, to finance their espresso operations and supply fertiliser, schooling and know-how.
ABN Amro structured the ability and acted because the mandated lead arranger and, alongside BNP Paribas and Rabobank, will present funding. The associate banks will share the dangers on farmer defaults, with the ability additional supported by two default ensures by the US Company for Worldwide Improvement (USAID) and IDH, The Sustainable Commerce Initiative.
On an annual foundation, and primarily based on a consultant pattern of debtors, NKG will report back to financiers and buyers on the impression per nation of its loans and investments from a social and environmental perspective.
The NKG Bloom initiative is designed to handle poverty in espresso communities and hopes to achieve 300,000 espresso households in 10 main espresso producing nations by 2030.
“It’s time to shift the conversation on sustainable coffee: from a demand-led overemphasis on compliance aspects, towards a farmer-centric perspective of solving poverty at farm level,” reads the awards submission, including that: “The smallholder livelihoods facility enables us to bring the power of the global financial markets – long the missing piece – to smallholder coffee farmers.”
Trio of hospitals for Oman
Deal identify: Oman Ministry of Finance hospitals
Borrower: Ministry of Finance, Oman
Quantity: US$873.7mn
International co-ordinating banks, joint structuring banks and bookrunners: Crédit Agricole CIB, Commonplace Chartered
Mandated lead arrangers: Crédit Agricole CIB (documentation financial institution), MUFG (agent financial institution), Natixis, Société Générale, Commonplace Chartered
ECA: UK Export Finance
Regulation companies: Baker McKenzie; White & Case
Tenor: 14 years (UKEF-supported loans), 5 years (business loans)
Date signed: February 15, 2019
The development of three hospitals within the Salalah, Khasab and Suwaiq areas in Oman are a “top priority” for the nation and can present intensive care, emergency providers and specialist child care to the sultanate’s residents.
Three UK Export Finance-supported purchaser credit (one for every hospital), mixed with each financial institution and UKEF lending along with three related business loans, have been made out there to the Omani authorities to finance the challenge.
The complicated cross-border financing construction is made up of US$700.5mn in UKEF-supported services, whereas the three tied business loans whole US$173.2mn.
Worldwide Hospitals Group (IHG), a world healthcare providers firm primarily based within the UK, will present gear from the UK provide chain for all three hospitals, whereas Omani sub-contractor Al Tafnim Enterprises will assemble and fee them.
All hospitals might be in-built compliance with UK NHS requirements – a prerequisite of the Sultanate.
The hospitals are the primary to be constructed with export finance assist within the area and on such a scale and required “intensive co-ordination of six separate financing facilities”, reads the submission. “The financing covers the construction of three hospitals in the Sultanate which serve significant objectives as they will provide high quality diagnostic, therapeutic and rehabilitation services for different medical cases in three governorates,” it provides.
SCF backing for Ørsted’s wind farm enlargement
Deal identify: Ørsted Wind Energy
Borrower: Ørsted Wind Energy AS
Quantity: DKr5bn (peak publicity)
Lender: NatWest
Regulation agency: Norton Rose Fulbright
Tenor: Revolving (180 days most receivable tenor)
Date signed: January 2019
Previously decade the Danish vitality firm Ørsted has gone inexperienced, transferring away from oil and fuel and investing huge in renewables as an alternative.
However the enterprise of main offshore and onshore wind initiatives in Europe, the US and Taiwan has posed challenges on the financing entrance.
On this profitable provide chain finance deal, NatWest supplied Ørsted with a tailor-made DKr5bn facility to assist tackle a few of these points.
Suppliers of turbine elements to Ørsted – which could in any other case wrestle to get entry to financing – had been in a position to get a “low-cost working capital solution” by the programme, as an example. Designed to be off stability sheet, the ability labored to assist Ørsted develop its international wind farms operations as effectively.
The deal additionally sought to handle the massive swings in funding necessities brought on by the cycle of initiatives closing and new ones starting, and was created with a mixture of funded and unfunded threat distribution strategies, with each the normal financial institution and credit score threat insurance coverage (CRI) markets offering liquidity and underwriting capability.
In the meantime Rabobank joined the programme below a funded threat participation construction with a DKr400mn maintain.
The deal submission reads: “CRI was also used to underwrite short-term peaks in exposure, enabling NatWest to maximise credit capacity, and by using a CRR-compliant policy, the bank could reduce overall capital requirements for the transaction, thereby keeping the cost of financing attractive.”
Previously referred to as Danish Oil & Pure Fuel (Dong Power), Ørsted has ditched fossil gas investments and invested DKr165bn in renewables lately, with the agency’s 2019 ESG efficiency report exhibiting that as of final yr it had upped its inexperienced vitality share to 86%.
In addition to offshore and onshore windfarms, Ørsted develops, constructs and operates bioenergy vegetation, photo voltaic farms, vitality storage services and supplies vitality merchandise for its clients.
Digging deep with blockchain-enabled multi-tier SCF
Deal identify: Rong-E Lian
Borrower: Rong-E Lian
Quantity: Rmb300mn
Lender: DBS Financial institution
Tenor: As much as 12 months
Date signed: August 20, 2019
Enabling upstream suppliers, which are sometimes SMEs that solely have entry to commerce finance at increased charges or typically by no means, is a constant problem for complicated provide chains.
DBS Financial institution has developed a blockchain-based provide chain administration platform named Rong-E Lian, in partnership with a Chinese language logistics agency, to assist SMEs past the primary and second tiers of provide chains get sooner entry to commerce finance.
Rong-E Lian gives multi-tier financing options to greater than 1,000 suppliers within the logistics agency’s provide chain, permitting customers to handle orders, shipments and funds, and join with banks for financing options.
The know-how means the credentials of a provider will be verified inside seconds and, as soon as these are verified, banks are in a position to supply digital commerce financing providers to upstream suppliers inside 24 hours.
By recording customers’ exercise and transactions, the know-how permits transparency all through your entire provide chain. This transparency additionally serves as an added safeguard towards potential information manipulation.
“The blockchain platform is integrated with DBS’ digital onboarding service, which requires facial biometric authentication when a supplier logs onto Rong-E Lian,” says Ginger Cheng, head of huge and mid-cap corporates, institutional banking group at DBS Financial institution. “In addition, the blockchain platform is also integrated with various China government databases to further validate and verify the authenticity of the transactions made by suppliers in the ecosystem.”
Argentina will get cellular community improve regardless of financial turmoil
Deal identify: Telecom Argentina
Borrower: Telecom Argentina SA
Quantity: US$96mn
Mandated lead arrangers: Banco Santander, JP Morgan
Lender: Finnish Export Credit score
ECA: Finnvera
Tenor: Eight years
Date signed: Might 2019
Argentina in 2019 was not a simple place to do enterprise. GTR has awarded this profitable deal for overcoming financial turmoil and political upheaval with a view to safe cross-border assist for a significant digital infrastructure challenge.
The financing, a US$96mn unsecured credit score line, is supplied to Telecom Argentina SA – identified regionally as Telecom – to assist its enlargement of the nation’s 4G cellular community and the conversion of copper wiring to high-speed fibre optic cable. The gear wanted is being provided by Finland-headquartered cellular know-how large Nokia.
The transaction is 95% assured by Finland’s state-owned financing firm Finnvera, and the lender is Finnish Export Credit score (FEC), a Finnvera subsidiary.
JP Morgan, mandated lead arranger together with Banco Santander, says in its awards submission that the deal will enable Telecom to match its cash outflows with the helpful lifetime of the underlying gear, including that it’s the first ever Finnvera-backed deal supporting the export of Nokia gear into Argentina.
JP Morgan and Banco Santander acted as preliminary lenders earlier than transferring all rights and obligations to FEC as soon as the transaction was closed in Might.
The deal came about towards a troublesome backdrop. Argentina’s October basic election resulted in Alberto Fernández ousting Mauricio Macri as president, following widespread dissatisfaction at Macri’s makes an attempt to pull Argentina out of a deep recession and sluggish the speed of inflation.
Leisure of foreign money controls was one in all Macri’s flagship insurance policies upon his election in 2015, amid guarantees of a business-friendly authorities, however they had been reinstated in September 2019 with the nation getting ready to default.
The earlier yr, Argentina had been granted an IMF loan of US$57bn – its largest ever – which additionally got here with strict situations together with a right away elimination of the nation’s deficit.
“JP Morgan and Santander were able to arrange a facility that would allow Telecom to benefit from competitive funding despite headwinds in the Argentine market,” the awards submission says.
Wind farm initiatives a leap ahead for Taiwan’s inexperienced vitality overhaul
Taiwan is forging forward with formidable plans to overtake its vitality manufacturing. The federal government plans to ditch nuclear energy and go inexperienced, setting a goal for 20% of the island’s vitality manufacturing to come back from renewable sources by 2025.
Nevertheless, development of the huge variety of offshore generators required is a problem, with officers acknowledging that worldwide assist is required. Chung-Hsien Chen, director of the electrical energy division of Taiwan’s Bureau of Power, says home establishments “lack the necessary technology, capital and licensed experts for maintenance” to go it alone.
“The threshold is too high for indigenous companies, and local banks have no experience in offering loans of this magnitude for energy investment,” he provides.
That has opened the door to worldwide buyers, beginning with a 2018 syndicated loan deal for the development of Formosa 1, Taiwan’s first commercial-scale wind farm. The next yr noticed the emergence of two even bigger offshore wind farm initiatives, each of which break new floor bringing collectively dozens of worldwide and native banks, legislation companies and export credit score companies (ECAs).
The Yunlin Challenge
Deal identify: The Yunlin Challenge
Borrower: Yunneng Wind Energy Co.
Quantity: US$2.75bn
Mandated lead arrangers, underwriters and bookrunners: Crédit Agricole, Deutsche Financial institution, Mizuho, SMBC, Commonplace Chartered, Taipei Fubon Industrial Financial institution
Lenders: BNP Paribas (Taipei), Cathay United, Commerzbank, CTBC Financial institution, DBS Financial institution (Taiwan), E.Solar, ING, KfW Ipex-Financial institution, MUFG Financial institution, Natixis (Taipei), Siemens Financial institution (Singapore), Société Générale (Taipei)
ECAs: Atradius, EKF, Euler Hermes
Regulation companies: Blanke Meier Evers; Linklaters; Lee & Li (all appearing for sponsor); Tsar & Tsai; White & Case (each appearing for lenders)
Tenor: 18 years
Date signed: Might 2019
This profitable deal entails a TN$85.5bn (US$2.75bn) loan to assist the event of a brand new offshore wind farm. Constructed 8km off the west coast of Taiwan, the Yunlin Challenge is anticipated to provide the island with 640MW of renewable vitality. It’s scheduled to grow to be operational by the top of 2021.
The borrower – a particular function automobile, Yunneng Wind Energy Co. – is 73% owned by German vitality agency wpd and 27% by a consortium of Japanese energy firms. The wind farm is anticipated to offer electrical energy to greater than 450,000 houses whereas offsetting practically 1 million tonnes of CO2 emissions per yr.
The deal brings collectively a complete of 15 worldwide banks and 4 native banks. SMBC acted as monetary advisor and Deutsche Financial institution as sole hedge co-ordinator for the transaction. Each banks had been additionally joint underwriters, bookrunners and mandated lead arrangers, together with Crédit Agricole, Mizuho, Commonplace Chartered and Taipei Fubon Industrial Financial institution.
The opposite lenders had been BNP Paribas, Cathay United, Commerzbank, CTBC Financial institution, DBS Financial institution, E.Solar, ING, KfW Ipex-Financial institution, MUFG Financial institution, Natixis, Siemens Financial institution (Singapore department) and Société Générale.
Linklaters, Blanke Meier Evers and Lee & Li act because the sponsor’s worldwide authorized advisor, German authorized advisor and native authorized council respectively. White & Case and Tsar & Tsai act as authorized advisor and native authorized counsel to the lenders. ECA assist comes from Atradius, EKF and Euler Hermes.
Describing the deal as a “landmark transaction”, Deutsche Financial institution says measures it took to mitigate exchange fee threat embrace “the largest deal contingent interest rate swap solution ever offered by a bank globally”.
Formosa 2
Deal identify: Formosa 2
Borrower: Formosa 2
Quantity: US$2.1bn
Monetary advisor: Société Générale
Mandated chief arrangers: ANZ, BNP Paribas, Cathay United Financial institution, Commerzbank, Crédit Agricole, DBS, Entie Industrial Financial institution, E.Solar, HSBC, ING, KGI Financial institution, MUFG Financial institution, Natixis, OCBC, Siemens Financial institution, Société Générale (monetary advisor), Commonplace Chartered, Sumitomo Mitsui Banking Company, Taipei Fubon Industrial Financial institution, Taiwan Life
ECAs: Credendo, EKF, Okay-sure, UK Export Finance
Regulation companies: Clifford Probability (sponsors); Linklaters (lenders)
Tenor: 18 years
Date signed: October 2019
GTR has awarded this profitable deal for supporting one other main renewable vitality challenge.
Constructed within the Taiwan Strait west of the island, the Formosa 2 wind farm is anticipated to offer 376MW of vitality to 380,000 households per yr – making it the most important within the area. The entire loan is TN$62.4bn (US$2.1bn), with a tenor of 18 years.
Bringing collectively a syndicate group of 20 banks and 4 ECAs, Société Générale says the deal “sets a new record for the number of financial institutions and export credit agencies mobilised in a single transaction”.
Société Générale acts as monetary advisor and a mandated lead arranger to the transaction.
NT$9.2bn (£230mn) of the loan was supplied by UK Export Finance (UKEF), supporting British companies concerned within the product. Its challenge financing needed to be put in place shortly and in Taiwanese new {dollars}, which UKEF says “demonstrates that project risk appetite in local currency is no barrier to UK support”.
Formosa 2 itself is 75% owned by Macquarie Capital and 25% by Swancor Renewable Power, the 2 companies that had been additionally behind Formosa 1. 49% fairness curiosity might be bought to Japanese utility firm JERA upon completion of the transaction.
The opposite ECAs offering assist are Denmark’s EKF, South Korea’s Okay-sure and Belgium’s Credendo. The sponsor’s authorized advisors are Clifford Probability and the lenders’ authorized advisors are Linklaters; insurance coverage and technical recommendation are supplied by Benatar & Co and Wooden Group respectively.
