A consortium led by Macquarie and Techint is raising funds to finance Mexico’s Norte III power plant.
Some 10 lenders will finance the Mexican transaction.
Two sources familiar told Inframation that Australian financial services firm Macquarie Capital now holds 86% of shares in the SPV behind the project. Meanwhile, Italo-Argentine developer Techint has a 9% stake, and Spanish developer Abengoa another 5%.
A third source familiar pointed out that by signing this transaction, the parties are completing one of Latin America’s largest and most complex deals in years.
The five-year miniperm financing is split into a USD 675m term loan and a USD 41m letter of credit, the sources said. The sources declined to comment on the exact spread over Libor. Additionally, the sponsor borrowed a VAT facility of an undisclosed value.
Natixis and SMBC serve as coordinating lead arrangers in the transaction. Mexican development and export credit bank Bancomext participated in the deal, in addition to Crédit Agricole, EDC, Intesa Sanpaolo, KDB, KfW and Norinchukin Bank.
A unit of US manufacturer GE committed USD 100m to the deal.
SMBC, serving as administrative agent, led the debt restructuring process and the M&A negotiations with US financial services firm Carl Marks for over a year.
Proceeds will now partially repay a previous USD 200m bridge loan provided in 2015 to Abengoa by Bancomext, Crédit Agricole, KfW, Santander and SMBC. The loan will also be used to complete the construction of the 924MW gas-fired combined-cycle Norte III power plant in the City of Juárez, Mexico. The required capex for the project is estimated at USD 983.28m, according to documentation disclosed by the Mexican regulator (CRE). Abengoa had noted in 2015 that the total investment in the 25-year concession would be USD 1.55bn.
The power plant project includes two sets of 175MW steam turbines and generators for a combined-cycle power plant containing technology from Toshiba. Norte III will receive its gas supply from the USD 109m San Isidro-Samalayuca pipeline, currently being developed by IEnova.
Techint will now take over as EPC contractor to complete the project, which should become operational in November 2019.
The sponsor will back the loan with cash flows from a 25-year PPA contract, which the Federal Electricity Commission (CFE) awarded Abengoa SPV Abeinsa Juárez N-III in January 2015. The Spanish developer won the contract with an offer of MXN 0.7446 per kWh, or roughly USD 63 per MWh. Following an in-court debt restructuring process, it had to negotiate the sale of a majority stake in the project.
Paul Hastings served as international legal counsel to the lenders, while Mijares, Angoitia, Cortés y Fuentes were the local legal advisors.
Milbank acted as international legal advisor to the sponsors, while González Calvillo was the local legal advisor.
Clifford Chance and Garrigues had been the lenders’ advisors for the bridge facility.
All the parties involved declined to comment.