Focus – News – November 2012

Welcome to the November 2012 edition of Focus

Main News

• We take a look at the possible effects of a LIBOR 2 on project financings
• Trinity publishes major paper with UN Economic Commission for Africa
• Three of Trinity’s renewables transactions reach financial close

Article ‘ 150 shades of LIBOR

In our article this month, new joiner Andrew Gray takes a look at the possibility of a reformed LIBOR and how it could lead to higher and more volatile lending rates.  We consider what should be done now to insulate projects from any adverse consequences.

New joiner

We welcome Andrew Gray to the Trinity team.  Andrew is a senior lawyer who advises clients on transactional matters in the energy, infrastructure and mining sectors.  In recent years, Andrew’s practice has focused on upstream oil & gas and power generation (including gas-to-power and renewables) in emerging markets, with a particular focus on African projects.   Andrew is a member of the Association of International Petroleum Negotiators.  Prior to joining Trinity, Andrew was a partner at Gowlings (UK) LLP, having previously worked in the London offices of Clyde & Co LLP and Freshfields Bruckhaus Deringer LLP, where he qualified as a solicitor.

Closed deals

In the last few months, we have closed or signed documentation in relation to the following transactions:

• Trinity acted on the largest renewables project financing to date in Romania, advising EP Global Energy alongside its co-funding equity partners, Marguerite Fund and Enercap Power Fund I.  The EUR91m funding package was led by EBRD, Erste Group, Unicredit Bank Austria and ING Bank.  Trinity advised EP Global Energy throughout the project’s development, including bringing in the new equity participants as well as arranging the debt financing package from the legal side.  The deal marked the first substantial infrastructure project on which the firm could apply its private equity capabilities, led by Hugh Naylor.  The equity arrangements completed shortly before the financing was signed.  The project and finance team comprised of Patrick Leece, Kaushik Ray and was led by Paul Biggs.
• Trinity advised a major South African bank in relation to the development of the 65MW Hopefield Wind Farm, developed by Umoya Energy (Pty) Ltd, in the first round of the renewable energy procurement programme in South Africa.  Trinity is currently advising lenders on a number of South African renewables transactions in the programme, split between the various phases.  Hopefield is the first of these to reach financial close.   The team on the Hopefield project was led by Patrick Leece and Simon Norris.
• Trinity advised a major South African bank in relation to the development of the 75MW solar PV plant, developed by Scatec Solar.  The team on the Scatec Solar project was led by Patrick Leece and Simon Norris.
• Trinity advised DEG and KfW, the German development finance institutions (‘DFI’), as well as the Emerging Africa Infrastructure Fund on the US$310m refinancing of the Olkaria III geothermal power plant in Kenya.  DFI lenders’ original project finance loan was refinanced by Overseas Private Investment Corporation (OPIC), an agency of the United States Government.  DFI lenders were advised by Kaushik Ray and Simon Norris.
• Trinity advised three major development banks on their private sector loans in Namibia to help improve access to finance and open doors to education. Trinity advised lenders on all aspects of the financing arrangements for loans totalling ZAR 165 million to Trustco Finance to support its student lending program in Namibia.  These financing arrangements are expected to enable Trustco Finance to provide more than 10,000 new micro-loans to Namibian students to further their education at Trustco’s distance-learning education institution, the Institute for Open Learning. Lenders were advised by Kaushik Ray.

In addition, in the past few months, Trinity:

• advised a major African bank on the closing of the financing for the refurbishment of a major West African airport;
• advised a UK-based fund on its joint venture arrangements concerning a telecoms receivables financing business;
• advised a private equity fund on its second-rounding funding of an East African agriculture business;
• advising shareholders on the buy-out of a minority shareholder in a UK solar business;
• advised a major African bank on the acquisition of a Nigerian petroleum industry services company; and
• advised a European trade finance bank on a refinanced loan to an Azeri oil major.

New instructions

We have been instructed on the following new matters in the past few months:

• advising, alongside a consortium of law firms, on the development of a major infrastructure project in Central America;
• advising potential equity investors into a wind farm in Kenya;
• advising a private equity fund on its acquisition of a West African healthcare business;
• advising an investor on the acquisition of shares in a West African mining business;
• advising a major African bank on a mining-related financing in Sierra Leone;
• advising the project company in relation to a large solar IPP in Ghana;
• advising the Government of Uganda and the utility in Uganda, UETCL, in relation to the development of standard form power purchase agreement and implementation agreement which can be applied to smaller hydro-power projects in the country; and
• advising an oil shale development company in respect of acquiring an Australian company and related transactions to acquire mineral exploration rights in Queensland.

Apart from the above, we continue to work day-to-day on transactions in Sierra Leone, Ivory Coast, Kenya, Ghana, Mozambique, Ethiopia, Rwanda, Mauritius, South Africa, Zambia, Madagascar, Uganda, Tanzania and Nigeria as well as in the UK, Azerbaijan, Croatia, Bosnia-Herzegovina, Central America and Romania.

Trinity rated in Legal 500 2012

The latest edition of Legal 500, published in September 2012, rates Trinity within Finance: emerging markets; Projects, energy and natural resources and Infrastructure.   Simon Norris, Paul Biggs, Patrick Leece and Kaushik Ray are all listed as “recommended lawyers’. Trinity remains the only boutique law firm to be rated in any of these sectors in Legal 500.

Publications

• The October 2012 edition of Corporate Livewire’s Expert Guide: Foreign Investment features a chapter, ‘Diligencing Transactions in Sub-Saharan Africa’ written by Hugh Naylor, Head of Private Equity at Trinity International LLP.
• The September 2012 edition of Financier Worldwide included an article entitled “Developments in Sub-Saharan Africa Private Equity Funds’, also written by Hugh Naylor, Head of Private Equity at Trinity International LLP.
• Trinity was appointed by the United Nations Economic Commission for Africa to deliver a report entitled ‘Building Public-Private Partnerships to scale up resources for Climate-Friendly Investment in Africa’.  The report was published in November and formally presented at the 2012 session of the African Union Conference of Energy Ministers of Africa.  The report draws on Trinity’s first-hand experience on successfully advising in relation to renewables transactions in Africa that have reached financial close and makes a series of policy recommendations, consolidating input from the report’s stakeholders (including the UN, African Development Bank, World Bank Group, other lenders, governments and private sector developers).  On the Trinity side, the report was written by Paul Biggs, Ana-Katarina Hajduka and Kaushik Ray.  A link to a copy of the report will be emailed under separate cover.

Getting in touch

As ever, if you have any comments or questions about Trinity, about Focus, or generally, please get in touch.

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