Selected Project Cases

Below, please find additional information on selected projects closed by AIL:

Export Financing - Energy-from-Waste Plant in Istanbul / Turkey

Europe’s largest energy-from-waste plant for municipal solid waste is to be built in Istanbul. The turnkey contract has been awarded by Istanbul Metropolitan Municipality (IMM) to the Swiss cleantech company Hitachi Zosen Inova (HZI) together with its Turkish partner, the construction company Makyol.

The plant will process with three incineration lines 1 million tonnes of waste per annum (approx. 15% of the city’s annual municipal solid waste) generating around 70 MW of electricity.

Apart from budget resources from IMM and commercial loans in the amount of EUR 120 million, the bulk of the project is financed by a long-term EUR 198 million export finance supported by the Swiss Export Risk Insurance SERV.

The financing of the project has been recognised by two leading international export financing platforms: it received the “Environmental Enhancement ECA-backed Deal of the Year” award from TXF and was featured in the “Best Deal of the Year” category by Global Trade Review.

Activities performed by AIL:
  • Structuring of the long-term SERV covered export finance
  • Structuring of project-specific loan disbursement scheme (against the background that the financing is denominated in EUR while the delivery contract is denominated in Turkish Lira)
  • Management and coordination of all activities related to the financing process up to financial closing amongst all project participants (IMM, SERV, banks, HZI and Makyol)
  • Providing advice and support to HZI in relation to the SERV application process and regarding risk mitigation

Financial Lease – MTR Express / Sweden

Financing of six Stadler Rail intercity FLIRT trains through a long-term financial lease to MTR Express (Sweden). Lessor and owner of the trains is a special purpose leasing vehicle specifically established in Switzerland for the lease of the six trains to MTR Express.

MTR Express (Sweden) AB operates long-distance trains between Sweden’s two largest cities Stockholm and Gothenburg on an open-access basis (i.e. provision of passenger train services without any governmental concession or subsidies, taking full commercial risk). MTR Express is part of the Hong Kong based MTR Corporation, which is responsible for Hong Kong’s public transport network.

Of particular note in respect of this transaction is the refinancing of the lease SPV, which consists of an 8.5 year fully amortizing SERV covered export credit and a commercial loan. The commercial loan is drawn during the lease term and serves to repay part of the SERV-covered export credit. At the end of the term (i.e. after 8.5 years) the commercial loan is due as bullet repayment or can be refinanced.

Based on this innovative refinancing structure it is possible to align the lease rate with the economic life of the trains of 30 years, which is beneficial for the lessee (i.e. MTR Express).

  • Financial Closing: January 2014
  • Role AIL: Financial advisor to Stadler Rail
Activities performed by AIL:
  • Structuring of the long-term tailor-made financial lease (incl structuring of the refinancing of the special purpose leasing vehicle specifically established for this project)
  • Management and coordination of all activities related to the financing process up to financial closing amongst all project participants
  • Providing advice and support to Stadler Rail throughout the entire financing process
  • Administration and executive management of the special purpose leasing company (incl. reporting, accounting, preparation of financial statements, management of compliance issues, communication with authorities, etc.)

Export Financing - Awash-Weldia Railway Project in Ethiopia

Construction of a new 389 km railway line by Ethiopian Railways Corporation (ERC) between the cities of Awash and Weldia.

The overall cost for the first phase of the project is approx. USD 1.2 billion, with several Swiss and Austrian firms involved as subcontractors to the Turkish general contractor. The Swiss and Austrian scope of deliveries and services include workshop design, delivery of workshop, telecom and power supply equipment, supply of catenary and rail welding equipment as well as delivery of railway turnouts and steel bridges.

The Swiss and Austrian portion represent an investment of USD 143 million, of which USD 126.7 million are financed under a SERV (Swiss Export Credit Insurance) covered long-term loan.

  • Closing: November 2014
  • Role AIL: Financial advisor to the main Swiss contractor
Activities performed by AIL:
  • Structuring of the SERV covered export financing, including SERV compliant supply contract structure
  • Support in the negotiation of the supply contract
  • Management and coordination of all activities related to the financing process up to financial closing

Project Financing – Hydro Power Plant for Benedictine Sisters in Tanzania

Construction of a greenfield 5 MW hydro power plant for Benedictine Sisters in Tanzania

Sponsor and Investor for the project is Mr. Albert Koch, a Swiss private individual, whose objective is to create a long term income stream for the Benedictine Sisters, to finance the Benedictine Sister’s charitable activities (Schools, orphanage, medical care, etc.). At the same time, the project will provide a stable electricity supply in the region, will allow the connection of new households to the electricity network and will permit the replacement to a large extent of diesel power plants currently in use in the region.

Total project cost is approx. USD 26.4 million, of which USD 18.5 million are financed by way of a SERV covered loan facility.

  • Closing: July 2014
  • Role of AIL: Financial advisor to project sponsor
Activities performed by AIL:
  • Structuring of the overall project, including supply contract structure and financial structure
  • Preparation of the necessary documentation for the financing process, including business plan, financial model, preparations for loan and SERV applications
  • Providing advice and support to the project sponsor regarding project structuring and project agreement negotiations
  • Management and coordination of all activities related to the financing process up to financial closing

Export Financing – Supply of Passenger Trains to Belarus Railways

Delivery of two 7-wagon Intercity passenger trains to Belarus State Railways BZhD by Stadler Rail Group, the well-known Swiss train manufacturer

The financing of 85% of the delivery contract value (approx. EUR 17.3 million) is secured by a long-term bank-to-bank loan facility backed by the Swiss Export Risk Insurance (SERV). A consortium of several Swiss banks was formed to provide a long-term SERV covered loan to Belarusbank. The proceeds of this loan are in turn made available to the Belarus State Railways under a local financing facility in order to purchase the trains from Stadler Rail.

  • Financial Closing: April 2014
  • Role of AIL: Financial advisor to the train supplier
Activities performed by AIL:
  • Structuring of the bank-to-bank SERV covered export finance loan facility
  • Providing advice and support in relation to the structuring and negotiation of the loan agreement
  • Management and coordination of all activities related to the financing process up to financial closing