14 Sep 2017 - 0:29
Nebras Power closes $2.75bn debt financing
By Satish Kanady / The Peninsula
Nebras Power, a joint venture of government entities Qatar Electricity and Water Company (QEWC); and Qatar Holding, has closed a $2.75bn multi sourced non-recourse debt financing through its affiliate Minejesa Capital B.V. 35.5 percent of Minejesa Capital B.V. is indirectly owned by Nebras Power.
The financing package consists of a $800m 20-year amortising bond, $1.2bn 13-year amortising bond and a 6-year $750m (equivalent) amortising corporate loan facility incorporating US dollar and Japanese Yen denominated tranches. Moody’s and Fitch confirmed investment grade ratings for the bonds: Baa3 and BBB- (respectively). The bonds are listed on the Singapore Stock Exchange.
Minejesa Capital B.V. is a joint venture owned by Nebras Power Q.P.S.C., Mitsui & Co., JERA Co. and PT Batu Hitam Perkasa. The objective of the joint venture is to invest in power projects and to raise financing in the global financial markets for such projects, Nebras said, yesterday.
The proceeds of the financing will be invested in PT Paiton Energy, an Indonesian power generating company, 35.5 percent indirectly owned by Nebras Power.
The funds will be used by PT Paiton Energy to prepay outstanding senior debt facilities and subordinated shareholders loans and for general corporate purposes. PT Paiton Energy provided an unconditional guarantee of the debt financing package.
This benchmark transaction represents the first project bond for an Asian credit in the international debt capital markets for more than a decade and is one of the largest transactions in recent times in the project bond space. It is considered as a landmark transaction concluded at extremely competitive pricing and will set a precedent for future Asian power project financings.
The bonds have received unprecedented levels of interest from investors internationally, resulting in very competitive pricing.
The investor appetite for the bond is a strong indicator of the confidence investors have in the credit quality of the asset and the sponsor group, and the robustness of its business model that generates long term stable cash flows.
On the basis of a $9.4bn order book (4.7 times oversubscription) comprising over 400 investors globally, the bonds were priced at the tight end of final price guidance, 4.625 percent and 5.625 percent for the for the 13-year and 20-year instruments, respectively. The $750m non-recourse bank loan facility was also oversubscribed up to $1.4bn and very competitively priced, further evidencing the high quality of the underlying credit.
Nebras Power has played a leading role in the transaction structuring and execution along with its joint venture partners.
Nebras Power is an international power company established in 2014 and headquartered in Doha. The Company has the mandate to develop and manage a portfolio of strategic investments in the power and water sectors throughout the world, outside of the State of Qatar. Nebras Power targets to achieve a well-balanced investment portfolio in terms of technology mix, markets and greenfield vs M&A development. South East Asia is a core market geography to Nebras Power.