Welcome to the 2017 Thomson Reuters Project Finance International (PFI) Yearbook. The Yearbook is our annual publication in which we look at the events of 2016, through case studies and the PFI Awards, and look forward into 2017 with interviews and articles in the Global section of the book.
Mitsubishi UFJ Financial Group (MUFG) has set out its stall in the project finance market over the past decade, buying Union Bank California in 2008 and then the RBS project finance book in 2010. It has built up a global team of more than 300 people. The move is part of a bigger international diversification strategy and combines the strength of the bank and its home deposit based with Japan Inc’s interest in project finance. What is more, the business it has built up has been soundly based on good credits, with a mix of lending, advisory and lead managing business. 2016 has seen more of the same, making it once again the Global Bank of the Year.
Japan and the East Coast of the United States both enjoy four distinct seasons: from the cherry blossoms of spring, to the sweltering heat of summer, to the splendour of the collage of colour in the autumn through to the chilling winds and powder snow of winter. Very different to the constantly grey and dismal nights we have come to know commuting on the South West Rail service from London Waterloo. By Aled Davies, partner Philip Fletcher, partner, and Dan Bartfield, partner, Milbank Tweed.
Chinese banks have been increasingly active in project finance, both in the onshore and outbound financing spaces. In relation to foreign peers they have the advantage of government capital support amid rising bad debt. But their rise has been stratospheric, even if it has been facilitated by less than pristine lending standards. By Jonathan Rogers.
The Asian Infrastructure Investment Bank’s origins may present as political but the need for such an institution is unimpeachable. ByJonathan Rogers.
Development finance institutions (DFIs) are evolving. No longer simply lenders of last resort, many are taking early-stage project roles and engaging with government on procurement to gain competitive advantage. David Donaldson,head of IFC InfraVentures, sub-Saharan Africa, explains why the IFC’s model has changed.
La Banque Postale Asset Management has established an in-house private debt team to concentrate on relative value opportunities in the infrastructure and real-estate sectors. Demand for real assets is unlikely to wane any time soon. By Nick Herbert.
Plenary Group has been building on years of steady growth in North America and Australia to see its most prolific year yet. By Alison Healey.
Meridiam has earned a reputation as a serious player in infrastructure finance in Europe, North America and Africa. Its CEO, Thierry Deau, talks to PFI about its strategy, its plans for growth and broader market trends. By Solomon Teague.
The Australian super fund industry’s involvement in infrastructure investment has undergone a radical change over the past six years unmatched anywhere in the world. PFI’s Australian Editor John Arbouw talks to IFM’s chief executive, Brett Himbury, about the changes.
Irish company Mainstream Renewable Power has created a subsidiary called Mainstream Renewable Capital that will offer custom-made opportunities for investors to gain exposure to the company’s multi-gigawatt portfolio of wind and solar projects. ByNic Stone.
Neoen survived the early boom-and-bust of French renewable energy firms and is now toasting to expansion abroad. The company is pouring money into huge solar and wind farms that are becoming its signature projects. By Stefano Berra.
Sumitomo Mitsui Banking Corporation (SMBC) was the standout bank for Americas project finance based on its innovation in structuring across the sectors and regions and in the face of challenges never before seen.
As of September 2016, more than 1.1m US homeowners have switched to residential solar, representing approximately 7.7 GWdc of capacity. By Ralph Cho, Michael Pantelogianis and Magali Cohen, Power & Infrastructure Finance North America, Investec.
The innovative Vista Ridge regional water supply project achieved financial close in November 2016, the day after the project received final approval from the public Board of Trustees of the San Antonio Water System. By Allan T Marks, partner, Milbank Tweed Hadley & McCloy LLP.
Mexican pipeline operator Fermaca recently closed two deals to finance the construction of an 830km pipeline corridor from Chihuahua to Guadalajara, in southern Mexico. The US$1.1bn combined transactions for the two pipeline segments represent one of the largest energy infrastructure deals to close in the region this year. By Tony Rivera, director, natural resources LatAm group, and Richard Enni s, managing director, ING Capital.
The first deal for a 4G highway officially closed this year. Just what was the anatomy of the deal and how did it come about? By Nic Stone
For one Caribbean port, the planning process in respect of the Panama Canal expansion led to the decision to utilise a public-private partnership model to attract investment and accomplish the necessary capital improvements. By Joe Seliga, partner and Jeromy Cannon, counsel, Mayer Brown.
From being a local industrial commercial bank in the late 1960s, DBS has been transformed to become a serious player in the project finance space. Its project finance team is relatively recent. A dedicated PF team was set up only in 2010, some six years ago. But already the team has made its presence felt, both as a lender and as an adviser.
On September 19 2016, the Victorian State Government announced it had leased the Port of Melbourne, Australia’s largest container port, for 50 years for a total up-front consideration of A$9.7bn. By James Hawkins, executive director, and Rowan Lang, vice president, Flagstaff Partners.
The Jawa 7 IPP secured the financing within sixteen months from the issuance of the RFP, establishing a new benchmark and replicable model for accelerated procurement and development of infrastructure in Indonesia. By Mark Ee and Pieter Jan De Schepper,HSBC.
From its shipping origins, the Aboitiz name has now become a major force to reckon with in the infrastructure space. Aboitiz Power Corporation has become a major player in the power sector in the country, and has started to set its eyes overseas. By Minerva Lau.
The significance of the GNPower Kauswagan Ltd Co financing is evident from the mix of international and local banks, plus the emergence of the non-bank financial institutions, which may serve as an alternative source of long-term financing in the future. ByJose Luis F Gomez, president and CEO of RCBC Capital Corporation.
The main challenge being faced by the Asia renewable sector is not the unavailability of funds, but the availability and access to secure bankable projects. By James Harris, partner, Karthik Kumar, partner and Nicholas Dimitriou, associate, Jones Day.
European Bank of the Year – Credit Agricole Credit Agricole’s European infrastructure and energy work in 2016 stood out for its breadth and depth. The bank won key roles in deals ranging from classic greenfield project financing to M&A and debt capital market transactions. As European banks’ ability to lend long-term is increasingly curtailed, Credit Agricole led the way in finding new ways to deploy capital and resources. The bank’s M&A work was particularly impressive. Credit Agricole worked on many high-profile infrastructure acquisitions throughout the continent this year. The list of deals includes the Coriance district heating in France, the SGI gas distribution network in Italy, the Akiem rolling stock in France, the Adven Nordic energy infrastructure business, the Navigator terminals in the UK. Its advisory practice evolved to specialise on equity ...
Sumitomo Mitsui Banking Corporation (SMBC) has expanded into the Middle East & Africa region just as other banks, particularly in the Gulf, have been pulling back – hit by the fall in the price of oil.
On August 11 2016, the Merkur Offshore project entered into a €1.2bn interest rate swap. This was the final stage of a re-development process that started in April 2015. By Alexandra Nilsson, founding partner at Amsterdam Capital Partners, Michael van der Heijden, founding partner at Amsterdam Capital Partners, and Oliver Fincke, director, Deutsche Bank.
Belgium has been a pioneer in offshore wind development. A new offshore grid connection is giving fresh impetus to the sector, and the first project that will use the new cable was financed this year. By Clément Weber andJérôme Guillet, Green Giraffe.
The A28 motorway refinancing introduced important new features in the listed project bond market in France and required a complex liability management exercise. By Daniel Zerbib, Cédric Burford and Guillaume Massole, Clifford Chance Europe.
The Ital Gas Storage project was the first wholly private facility of its kind ever financed in Italy under a long-term non-recourse financing. By Stefano Cassella, founding partner and CEO of Arcus Financial Advisors,Giovanni Gios, head of business development of Whysol Investments, and Giacomo Donnini, chief financial officer of Ital Gas Storage.
The Izmir Kocaeli deal is a pathfinder for Turkish PPP hospital transactions given that it brings to the sector a substantial amount of funding from untapped sources such as OPIC and EDC. By Peter Aurich, managing director, Busra Unaldi, director, and Damir Bartolovic, associate director, UniCredit.
The closing of the 2,400 MW clean coal IPP in Dubai has set a benchmark in terms of transaction complexity and sourcing of finance, with a select group of Chinese banks and institutions coming together with other international and regional players. ByAtanu Das, executive director, Yunhe Lu, executive manager, Anil Vijayachandran, senior manager, and Haoyong Chen, manager, ACWA Power’s acquisitions and project finance group.
There is now a rich diversity of lenders in the project finance arena. From a decade ago, when there was a straightforward mix of banks and monoline insurer-backed bond investors, plus a few uncovered bond buyers, there is now complete smorgasbord of players. Who will win through in 2017?