APAC: Formosa I offshore wind farm loan attracts strong interest

13 February 2018 - 12:00 am UTC

Over 20 banks have responded to a request for proposals (RFP) to join a 15-year NTD 15bn (USD 500m) syndicated loan for Taiwan’s first offshore wind farm.

Financial close is scheduled for the second quarter of this year, according to a source. 

A few lenders including Cathay United Bank (CUB) are currently in negotiations with the developer of the Formosa I Offshore Wind Farm​​​​​​ ​​​​to act as lead arrangers for the loan according to the above-mentioned source and a second source.

Foreign lenders account for 65%-70% of the respondents to the RFP according to a spokesperson for developer Swancor.

He added that domestic banks have also shown “strong interest” in lending to the 120MW second phase of the project.

The bank group has not yet been selected. BNP Paribas is financial advisor for the syndicated loan.

Formosa I is Taiwan’s first and only operating offshore wind farm by dint of its 8MW first phase. Project company Formosa Wind Power Co is owned by Macquarie Capital, Ørsted and Swancor.

In May 2016, CUB, Entie Commercial Bank and France’s BNP Paribas inked an NTD 2.5bn five-year syndicated loan to fund construction of the first two turbines (8MW) of Formosa 1. All three banks were mandated lead arrangers for that loan.

Apart from the Formosa I project, Swancor is currenly working with Macquarie Capital to develop three offshore wind farms in Taiwan’s wind-rich Changhua county.

The pair recently introduced German utility EnBW to take a 37.5% stake in the 2GW Formosa III project, the first phase of which is scheduled to be completed in 2021.