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A summary of JCRA advised Project Finance & Infrastructure deals

July - September 2019

Project Finance & Infrastructure Deal Digest

Risk Management Advisory Firm of the Year

JCRA has been recognised as Risk Management Advisory Firm of the Year at the GlobalCapital Global Derivatives Awards 2019.

The awards recognise the institutions, products and services that have improved the global derivatives markets during the last 12 months. Competing with major firms from across the industry, the winners were decided by an editorial panel, supported by market soundings and client testimonials, before being unveiled at a gala dinner at the Banking Hall in London on Wednesday 25th September 2019.

Commenting on JCRA’s award, Jackie Bowie, Group CEO, said: “We are so thrilled to have been recognised as the Risk Management Advisory Firm for 2019 in the face of some very stiff competition. This award is testament to the hard work, technical expertise, and best in class derivative knowledge within the JCRA team. Collectively, we have ensured that we continue to offer the best service to our clients and optimise their financial risk management decisions.”

Congratulating JCRA on its victory, GlobalCapital said: “JCRA has been bold and ambitious in taking its derivatives expertise to an increasing variety of regions and clients, and has also worked to make derivatives function for the real economy, with compelling engagement and innovation in with the renewable energy sector, private equity, and UK housing associations.”

“Collectively, we have ensured that we continue to offer the best service to our clients and optimise their financial risk management decisions.”

Deals we recently advised on:

Independent Hedging Advice3

Refinancing of two Solar Farm Assets

Solar PV RefinancingPre-Execution FX

AnalysisAberdeen EfW

PEN FX Analysis and Pricing

UK Solar Refinancing383MW Offshore

Wind FarmOffshore Wind Farm

RefinancingWind Portfolio

Refinancing

Large Offshore Wind Farm Pre Hedge, FX

Implementation, Interest Rate Hedging

UK offshore wind farm refinancing – IR hedging

Independent Hedging Advice4

• A consortium of three sponsors of a UK offshore wind farm was looking to refinance its stake

• The sponsors’ existing debt and corresponding hedges were held with six banks

• The sponsors were planning to refinance with seven new banks

• JCRA worked alongside the group of sponsors and their financial adviser to define an optimal hedging strategy for the new debt, as well as managing the existing hedges

• The sponsors were also interested in hedging their inflation linked revenues

• Conducted a cost analysis for breaking existing out-of-the-money interest rate swaps vs restructuring the existing swaps and novating them to the new hedge counterparties

• Provided information on the hedge accounting implications of each strategy

• Recommended the overall optimal IR hedging strategy, which was to novate and restructure the existing hedges

• Competed credit spreads between the seven new banks

• Assisted in appointing a sole hedge co-ordinating bank

• Benchmarked mid-market levels to ensure fair pricing

• JCRA evaluated the feasibility of entering into a hedge for the project’s inflation linked revenues

• The refinancing of the project was successful and achieved the objectives required by the sponsors

• Smooth financial close and novation of the interest rate swaps occurred on time

• The sponsors achieved competitive execution, competitive credit pricing and a substantial xVA rebate, negotiated by JCRA

• Sponsors avoided paying any break costs on the existing hedges

Transaction Parameters

• 18 year GBP 315m facility

• 11 bank process

• 3 sponsors

CASE STUDY

Background Approach Benefits

Real Estate | Private Equity | Social Housing | Project Finance & Infrastructure | Corporates

The information contained in this presentation should not be distributed beyond the intended recipients and should not to be reproduced in any form without the express consent of JCRA.

This presentation may have been supplemented by additional information discussed during any meetings, phone calls or oral presentation (s) between us, and this should be taken into consideration when reviewing this presentation.

If you require any information, explanations, or specific advice, please contact us and we will be happy to discuss this with you.

J.C. Rathbone Associates are authorised and regulated by the Financial Conduct Authority.

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