LatinFinance - September/October 2015 - 104

from the Export-Import Bank of Korea
(Kexim), $249 in commercial bank debt, a
short-term $40 million VAT facility and $32
million in letters of credit.
South Korean companies Kospo and
Samsung C&T, are developing the project,
which will power BHP Billiton's Escondida,
Cerro Colorado and Spence mines.
Lenders had to get comfortable with a
number of the project's unique elements,
including Kelar's isolation from the grid.
That arrangement, along with BHP's role as
the fuel provider for Kelar, made the project
unusually dependent on offtaker BHP.

Project: 540MW Kelar combined
cycle gas-fired plant
Location: Chile
Financing type & size: $517m loan
Banks: K-Sure, Kexim, Mizuho, MUFG,
Natixis, Santander Chile, SMBC
Law firms: Cariola Díez PérezCotapos, Claro & Cia, Linklaters,
White & Case

"This is an attractive project financing
structure and not very common in the
Chilean power market," Choi Yoonjung, a
manager at Samsung C&T's finance team,
says. "Also, the offtaker is a worldwide
company, so it lowers risk and gives comfort
to the structure of the deal".
Chilean authorities published changes
to their tax mechanisms in the midst of
financing negotiations. Lenders required
further support from the sponsors as well
as a secure confirmation from BHP that
the company would commit to its offtake
agreement to service its mines.
SMBC, Mizuho, Mitsubishi UFJ Financial
Group and Natixis were mandated on the
17-year deal, six months after the 15-year
offtake agreement was signed in November
2013. Santander Chile meanwhile, provided
the Chilean peso-denominated $40 million
VAT facility. LF

BEST INFRASTRUCTURE FINANCING:
CENTRAL AMERICA

CORREDOR TURÍSTICO
The $145 million deal backing Grodco and
Prodecon's Corredor Turístico in Honduras
sets a solid example for other countries in a

104 LATINFINANCE.COM - September/October 2015

region needing infrastructure investment
in the coming years.
The transaction, which marks the first
time a major international commercial
bank has worked on a deal in Honduras
since the country's constitutional crisis in
2009, is remarkable for the government's
critical and positive role in securing
JPMorgan's participation.
"Our first challenge was to get the
international banks and MIGA on
board, when they both were requiring
a definitive commitment from the other
before accepting to join," Grodco's
executive vice president Armin García
says of the Multilateral Investment
Guarantee Agency and CIFI, the
Corporación Interamericana para el
Financiamiento de Infraestructura.
The participation of multilaterals,
which tend to have more stringent due
diligence standards and requirements,
enticed JPMorgan. The participation of
Ficohsa, Honduras' largest local bank,

Project: Corredor Turístico
76-mile highway
Location: San Pedro Sula to
La Ceiba, Honduras
Financing type & size: $145m
senior loan
Banks: CIFI, Ficohsa, JPMorgan,
MIGA
Law firms: Broad & Cassel,
Clifford Chance, Gutiérrez
Falla & Asoc., Matamoros & Asoc.

as well as the easy accessibility of the
Honduran government sealed JPMorgan's
commitment to the transaction, four
months before MIGA officially granted its
guarantee, in April 2015.
The government engaged with MIGA
and JPMorgan to modify the public private
partnership contract to make it bankable,
García says, adding that this dialogue was
fundamental to the deal because it gave
the international bank comfort around
providing long-term financing. Since
wrapping up the deal, JPMorgan officials
are understood to be considering other
projects in the country based on the
partnership built with the government.
"It sends the message that with the

adequate structure, the right alliances and
experienced sponsors, foreign investment
can be drawn to the country. Also, it proves
the notion that the PPP framework is the
tool and the way to push for infrastructure
development in the region," García says. LF

BEST LOCAL CURRENCY FINANCING
BEST ROAD FINANCING
BEST INFRASTRUCTURE FINANCING:
ANDES

RUTAS DE LIMA
The hybrid bank and bond financing
package behind the Rutas de Lima project
demonstrates the potential of international
and local institutional investor funding for
well-structured infrastructure risk in Latin
America, particularly when projects have
strong support from domestic financial
players and governments.
"This transaction has proved that
appetite exists among local and foreign
investors for this type of paper," Raul
Pereira, chief executive of the Rutas de Lima
consortium, tells LatinFinance.
Rutas de Lima raised $200 millionequivalent through a 15-year senior secured
loan. Local currency cash flows enticed in
domestic lenders BCP, BBVA and Interbank.
Yet Peru's somewhat shallow commercial
bank market and the size of the financing

Project: 72-mile highway
expansion & improvement
Location: Lima, Peru
Financing type & size: PEN1.46bn
($520m) bond, PEN560m
($200m) loan
Banks: BCP, BBVA, Credicorp
Capital, Goldman Sachs, Interbank
Law firms: Davis Polk, Mayer
Brown, Rodrigo Elías & Medrano,
Rubio Leguía Normand,

meant that a debt capital market transaction
was inevitable for at least a portion of the
deal.
Bonds provided the possibility of a
tenor that came closer to the project's
30-year concession agreement. Peruvian
infrastructure projects had been financed
in dollar-denominated bonds in the past,
as sponsors aimed for deeper international
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