Date post: | 14-Aug-2015 |
Category: |
Engineering |
Upload: | david-patrick |
View: | 47 times |
Download: | 0 times |
Strictly Private and Confidential
Structuring Infrastructure Development Programmes in Africa
10th September 2010
Best Pan-African
Investment Bank 2009
Best Investment Bank in Africa 2009
Best African Debt House 2009
Best Investment Bank in Africa
2009 and 2010
2
Table of contents
SECTIONS
1. - Introduction to Standard Bank 3
2. - Infrastructure Sector Comments 9
3. - China in Africa 17
4. - Indicative Transaction Structures 21
5. - Discussion Points 27
4
01
“Full service
bank covering”
Standard Bank Group has a global presence operating in 17 African countries
and 16 countries on other continents including the key financial centres of
Europe, the Americas and Asia.
African-based financial services group focused on emerging
markets on global scale
Full service bank covering
Investment banking
Corporate banking
Personal and business banking
Investment management
Life assurance
Global reach in 33 countries with capabilities in world‟s leading
financial centers including London, Moscow,
Sao Paulo, Hong Kong and Beijing
Corporate and Investment Banking (“CIB”) provides services
to corporate clients, financial institutions and international
counterparties focused on emerging markets around the world
Over 45,000 employees world wide
Relationship with ICBC provides international reach and
strengthens access to what will soon be the world‟s largest
economy
“Global reach in
33 countries”
“Relationship
with ICBC
provides
international
reach”
Standard Bank Group is a South African-based financial services company with a global presence operating in 17 African
countries and 16 countries on other continents including the key financial centres of Europe, the Americas and Asia.
Rest of world Key regional officesAfrica
17 African
countries
712 branches in
South Africa
239 branches in
the rest of Africa
16 countries
outside Africa
Offices in key
regional financial
centres including
London, Moscow,
Sao Paulo,
Beijing, Hong
Kong and Dubai
5
Strategic co-operation areas
Largest bank in South Africa and Africa
Global footprint in 33 countries
Strong on the ground presence in Sub-
Saharan Africa, Argentina, Brazil, Turkey,
Russia and China with
Large product teams in Johannesburg,
Lagos and Nairobi and support teams in
London, Hong Kong and New York
Specialist expertise in Oil & Gas, Mining &
Metals, Power & Infrastructure and
Telecoms
Employs more than 50,000 people globally
Operating expertise and risk management
experience in global markets
World‟s largest, most profitable bank
3.6 million corporate banking customers
216 million personal banking customers
2009 Full Year Profit of $18.5bn
Strong balance sheet. Total assets of
$1.7 trillion
Overseas assets grew 22.9% in 2009
Unrivalled distribution network in China
Access to valuable corporate clients
Aggressive overseas strategy to support
Chinese companies “going global”
Formal co-operation areas: corporate
banking, resource banking, investment
banking, global markets & treasury,
direct investments, risk management.
Enhanced financing size and tenor,
enabling support of larger size
transactions, which include Chinese
resource and infrastructure opportunities
in Africa and selected emerging markets
Large deals in Botswana, Ghana, Brazil,
Russia
Not exclusive relationship
Standard Bank and ICBC can together deliver Chinese/African solutions for Africa
Construction clientsPower clients
The ICBC/Standard Bank Strategic Partnership
6
Recent Accolades
Global Finance Magazine – 2009
Best Africa Investment Bank (2009)
Best Africa Research Team (2009)
Infrastructure Deal of the Year for Gautrain
(2008)
Africa Investor – 2009
Best Investment Bank in Africa (2010)
Best Investment Bank in Nigeria (2010)
Best Bank in South Africa (2010)
Best Equity House in Africa (2009)
Lakatabu Expansion - Africa Industrial Deal of the Year (2009)
MTN Uganda - Africa Telecoms Deal of the Year. (2009)
Zain - Middle East Telecoms Deal of the Year (2009)
Euromoney – 2010, 2009The Banker – 2010, 2009, 2008
Deal of the Year Africa: Bonds (2010)
Deal of the Year Africa: Capital Raising (2010)
Deal of the Year Africa: Structured Finance
(2010)
African Bank of the Year (2009, 2008)
Bank of the Year, South Africa (2009, 2008)
Best Investment Bank from Africa (2009, 2008)
Best Bank in Botswana, Lesotho, Malawi, Swaziland ,
Tanzania (2009)
Deal of the Year for the Ruashi Copper Mining Project in
DRC (2008)
Deal of the Year - Botswana for National Development Bank
BWP100 million 11.25% notes due 2017 (2008)
Deal of the Year - DRC for the Ruashi Copper Mining
Project (2008)
Deal of the Year - Finland for Talvivaara Nickel Project
US$320m debt facility (2008)
Deal of the Year - Germany for Kreditanstalt fur
Wiederaufbau NGN28.7 billion 8.5% notes due by 2011
(2008)
Deal of the Year - Tanzania Electricity Supply Limited
TZS300 billion syndicated loan (2008)
Deal of the Year - Zambia Sugar Project (2008)
Deal of the Year (South Africa) for the 20% investment by
ICBC in Standard Bank (2008)
Deal of the Year Award - Bahrain for Arcapita Bank US$1.1b
syndicated Murabaha facility (2008)
Most innovative in Trade and Project Finance (2008)
Ranked No 1 in sub-saharan Africa and No 106 in The
Banker Top 1000 World Banks (2008)
Standard Bank has won various awards that demonstrate our capabilities across the entire range of advisory and funding services in Africa
EMEAFinance – 2009, 2008
Best Investment Bank in Africa (2009, 2008)
Best Investment Bank in Nigeria (awarded to Stanbic IBTC
Bank) (2009)
Best Natural Resources Deal in EMEA: Kayelekera
Uranium project (2009)
Best Oil and Gas Deal in Africa: Oando (2009)
Best Project Finance Deal in Africa: Botswana Power
Corporation (2009)
Best Project Finance House in Africa (2009)
African Banker – 2009, 2008
Investment Bank of the Year, Africa (2009)
Best Issuing House in Africa (awarded to Stanbic IBTC
Bank) (2008)
Deal of the Year - ICBC 20% acquisition of Standard
Bank (2008)
Environmental Finance Magazine - 2009
Carbon Finance Deal of the Year for Camco-Standard
Bank Structured Carbon Credits Transaction (2009)
Best Debt Bank in Africa (2009)
Best Foreign Exchange Provider in South Africa (2009)
Best Investment Bank in Africa (2009)
Best Investment Bank in Nigeria (2009)
Best Investment Bank in South Africa (2009)
A selection of recent accolades awarded to Standard Bank…
7
Standard Bank – Recent/Ongoing Africa Infrastructure Deals…
DescriptionClient Date
Advisor and lead arranger to the Strabag-led consortium being the preferred bidder for the 30 year Nairobi toll road concessionCurrent
Arranger of additional finance to Republic of Mozambique Pipeline Investment Company, which was part of the Sasol Natural
Gas Project, in order to expand the existing capacity of the pipelineCurrent
Joint lead arranger to the Bombela Consortium, for the development of the approximately US$3 billion Gautrain high-speed rail
PPP project linking Johannesburg to Pretoria, Sandton and Johannesburg International Airport
The largest greenfield rail concession currently under construction globally
The consortium consists of Bouygues TP, Bombardier, Murray & Roberts, SPG and French Metro operator RATP
2008
Joint lead arranger to Trans African Concessions for the R3 billion refinancing of the N4 Maputo toll road linking Witbank to
Maputo
First refinancing of a South African concession and realized substantial value for the shareholders
2006
Financial adviser and joint lead arranger to Lekki Concession Company Limited, for the development, financing and operation of
a USD300m toll road in Lagos State2008
Joint Mandated Lead Arranger and Underwriter to TAV Havalimanlari Holdings which was awarded a 40-year concession to
operate and maintain an existing airport in Monastir, Tunisia and a 40-year concession to design, build, finance and operate a
new airport at Enfidha, Tunisia
Debt Package of €398m
2008
8
Case Study: Lagos Infrastructure Project LCC
LCC is a Special Purpose Vehicle set up specifically to
execute the Lagos Infrastructure Project
The project is designed to deliver essential road
infrastructure and services along the Lekki Peninsular of
Lagos
The newly refurbished/constructed 49.4km of the Lekki-Epe
Expressway (Phase I), and the 20km of the Coastal Road
(Phase II), will be operated and maintained by LCC
throughout the 30-year concession term
Hidden costs of „go slow‟ and bad roads have adverse
economic, social, psychological and health impacts, on
Nigeria‟s citizenry
PPPs are a globally accepted model for financing and
delivering essential infrastructure using the private sector, and
can help bridge the gap where government resources are
insufficient.
The project takes the cooperation of all road users to ensure
that they derive the optimum benefits from the new road
systems being implemented by LCC
Standard Bank was the joint financial advisor and
mandated lead arranger with an injection of US$ 430
million
This project is the first toll road PPP in West Africa
The base layer of the newly constructed road is designed to
last 30 years. The original asphalt layer is designed to last 10
years. It will be replaced a number of times over the 30-year
concession term
10
Why is Infrastructure Important in Africa?
The World Bank notes a 1% increase in a country's infrastructure stock is associated with a 1% increase in the level of GDP
Economic Research (Aschauer, 1989; Munnell, 1990) has demonstrated the clear linkage between infrastructure expenditure and
GDP growth (e.g. through increased productivity, reduced logistics costs etc). Conversely, inadequate infrastructure is cited as a
key constraint to investment and growth (ADB,2007). Therefore, the provision of quality infrastructure is a necessary element of any
strategy for economic integration and sustainable development in Africa
It is predicted that emerging economies will spend an estimated $22 trillion on infrastructure over the next ten years, of which China
will account for 43%. Never before has infrastructure spending been so large as a share of world GDP. Further, all US / European
post credit crunch bail out plans have the same idea
An example of sector challenges are railways. Large parts of the African railway network are substandard, owing to a lack of
investment and maintenance. Many of the publically owned railways are in deep financial trouble, and are deficit ridden, under-
funded and plagued by low productivity. Africa as a whole has a reported new annual infrastructure investment requirement of USD
40 billion with a matching annual amount needed to be spent on maintaining existing networks (World Bank 2008)
Africa‟s railway network is struggling to meet the growing demand and keep up with the technological change, facing competition
from other modes of transport and competing for finance with other important public concerns. Railway transport remains the best-
suited mode for hauling large volumes over medium and long distances (e.g. over 500km).
15 countries in Africa are land-locked and it is estimated that 40% of the continent‟s population lives in these countries, hence
efficient cross-border transportation is vital for their economic development. Rail is ideally suited to move goods to these countries
11
African Infrastructure - The Old World…
Due to smaller resources / capital markets, issues that impact on a global scale may have a larger effect upon African countries
Capital costing environment:
– Capital costs were increasing by 30% CAGR. Why? Global boom, limited suppliers / contractors and high commodity prices, leading toescalating EPC construction and supplier contract prices
Procuring African countries do not always think joined up:
– A lack of alignment between stakeholders in policy formulation and execution. Due to inadequate international benchmarking, frequent gapsbetween stakeholder “aspirations” of investor / lender market appetite and the necessary practical steps needed to facilitate investment (e.g.cost reflective tariffs, mining licences which create certainty)
– Frequent under appreciation of the criticality of adequate, reliable feedstock to encourage power investment (e.g. Nigeria) and / or arecognition that T&D issues must be solved to facilitate generation projects
– Functional organisational structures not centred on project delivery, with a shortage of multi-disciplinary professionals to act as the “clientteam”
Currency risk:
– Unless otherwise supported/structured, currency risk will cap international investor/financier interest as they usually need hard currencyrepayments / returns. Could you convince your Board to take commodity-type risks for infrastructure-type returns in a sub-Investment Grademarket?
Underdeveloped capital markets:
– Where is the exit route? How easy is it to transfer ownership? Is there local refinancing appetite/capacity?
Deal Flow and Bureaucracy:
– A major impediment. Lost time = higher cost for project developers and a reduction in development appetite
Increasing environmental oversight:
– Investors and Lenders generally prefer sustainable projects. Non-compliance with the Equator Principles is a show stopper (over 60 bankssigned up)
Skilled labour shortages:
– Shortages at Project manager, engineer and artisan levels, leaving aside stakeholder shortages
12African Infrastructure – The “New World”…
Context:
– Investing in African power / infrastructure is not usually for the marginal player – more a specialist activity so less subject to boom and bust
– Project lead times will likely take longer than the credit crunch/global recession, e.g. often 3 years plus
Developer Perspective
– Some cut backs in capital expenditure (e.g. focus on lower risk markets) but reduced bank financing capacity is a larger issue
Financing Perspective:
– Ability of African banks to raise USD has been dramatically affected, hence a focus on local currency financings which caps project size
– Current turmoil in the global credit markets has impacted on closings and increased borrowing costs. However, few clients have walked away
with more club deals seen. Limitation on banks‟ liquidity/capacity BUT project finance less affected than most debt financing classes
– Flight to ECAs and DFIs across all markets, not just Africa. Follow on question is their ultimate African appetite given competing liquidity
demands
– Next global phase will be funding the G8 banking bailouts and watching the impact on global liquidity (i.e. less money available for African
borrowers)
Supplier Perspective
– Recent softening of forward-looking equipment prices but no dramatic plummet. Note most bail-outs encourage infrastructure spending
– Suppliers‟ order books not as full for 2011 so schedule savings starting to occur (saves on IDC)
Country Perspective
– Underlying need is still there but reduced ability of oil / commodity exporting countries to pay for new capacity (e.g. banking base case of USD
60bbl v USD 80bbl)
The credit crunch has had less of a direct impact on African infrastructure than elsewhere but is still of note…
13
What is different about a city?
Particular construction and integration challenges
– Multiple greenfield sub-sectoral projects
– Needs close integration between projects (project on project risk)
– How do you finance them all? All need to be in place for the city to effectively function
Hybrid nature of risk profile
– Property Development? Meaning high equity component, high reward property sector investors needed
– Infrastructure? Meaning lower equity component, lower reward sector investors needed
Few global parallels that have raised third party finance
– Arabian Gulf comparators (e.g. Dubai Palm) executed through listed / capitalised property companies
Usually, multiple jurisdictions responsible for separate services (e.g. power, water, telecoms) which adds to the complexity
– Once built, can you really isolate a project? A tenet of limited recourse project financing
– Who owns what and how do they integrate with each other?
What is the ultimate source of repayment?
– Residential Sales, Property Levies (implies property sector risk profile)
– Municipal Levies (implies infrastructure sector risk profile, but how are the above assured?)
14Utility Financing – Business and Financing Challenges
Structural
– Adequate provision of electric power, together with water and sanitation is clearly a pre-requisite for a successful city
– Will the city have its own power supplies or be dependent on the national grid?
– How will the city receive raw / potable water? Will the city have its own waste water treatment facilities?
– Utility financing has established global business models, centred around clear performance rights and obligations and cost recovery
Cost Recovery
– How will Investors in utilities secure their returns / cost recovery?
– Through Power Purchase Agreements (PPAs), Water Purchase Agreements (WPAs) of Waste Treatment Agreements (WTAs)?
– Who will be the counterparty for such agreements? And how will they recover their costs?
Third Party Challenges
– Is there adequate fuel supplies for the Project? Reliable volume and price
– Is there an adequate HV Transmission Network to supply the city? And / or distribution networks?
– Is there an adequate water trunk mains, and / or waste water treatment plants?
– How will utility provision be incorporated into the other pending infrastructure requirements, e.g. local roads, railways and the
construction of the same?
15
Railway Financing - Business and Financing Challenges
Railways are an important mode of transport but are not without challenges. Examples of which are:
– Rail faces a high threat of transport mode substitution (from road transport and / or marine, depending on location)
– Although a long lasting asset, railways need to be maintained to promote efficiency – few are…
– Financiers usually have limited appetite for farebox/traffic risk. Key financing issue is usually affordability
Key railway financing challenges include:
– Aarhus University has shown that most global railway projects have over-estimated potential ridership, hence their commercialrisk is proven
– Limited capacity and / or willingness of private operators to finance track renewal
– Railway concession returns have often been low (e.g. sub 10% IRRs)
– Effective and efficient regulation of private operators is needed
– Road transport operators rarely pay the full cost of their transport mode
Specific African challenges include:
– No significant experience of mass transit which is centrally organised (e.g. dependence on taxi services)
– Interest in rail has lagged growth of cities so very hard to implement given growth
– Where it exists, ageing and poorly maintained rail network conditions
– Few benchmarks of where to set fares to optimise the market‟s interest
– Very low investment in rail. World Bank estimated only 0.2% of African GDP would be spent on rail 2005 – 2015
– Little public consensus on whether the user should pay, whether today‟s taxpayers should pay or tomorrow‟s tax payers / usersshould pay
16
Road Financing - Business and Financing Challenges
Roads are a vital mode of transport but are not without challenges. Examples of which are:
– Roads must be maintained to promote economic efficiency
– Congestion is a global problem
Key road financing opportunities and constraints include:
– Potential for toll roads in areas with high (wealthy) urban population and / or for long-distance corridors without substitutes
– Need for high car ownership in market to create traffic / consumer base
– Globally, there is often a consumer resistance to paying road tolls in markets where they were previously free.
– Effective and efficient regulation of private operators is needed, as road transport operators rarely pay the full cost of theirtransport mode, e.g. impact on pollution, accidents etc
– However, South African (N1, N3, N4) and Nigerian (Lekki Toll Road) has shown it is possible to finance toll roads through projectfinance
Specific African challenges include:
– Ageing and poorly maintained road network conditions
– Minimal high speed motorway road links (outside of South Africa)
– Governments are failing to develop an effective consultation mechanism to involve community members
– Limited stakeholder / bureaurcratic capacity
– Little public consensus on whether the user should pay, whether today‟s taxpayers should pay or tomorrow‟s tax payers / usersshould pay
– Therefore, there is clearly some commonality in the challenges facing the Africa road and rail sectors
Source: Standard Bank
18
A reciprocal relationship: Resources for Infrastructure?
Copper
Standard Bank and ICBC have a strategic
partnership dedicated to growing China-
Africa trade and investment in a manner
that benefits both sides.
Oil
Iron Ore
Precious metals
(gold, platinum)
Goods:
Infrastructure equipment
Construction machinery
Electrical appliances
Consumer goodsTimber
Steel metals
(Chrome, Manganese,
Nickel, Zinc)
Financing:Investment
Soft Loans
Commercial bank loans
Export Credit Guarantee
Infrastructure expertise:
Hydropower dams
Thermal power plant
Nuclear power plant
Wind/Solar power
Roads
Railways
Airports
Ports
ICT networks
China sources 30% of its oil imports from African countries, plans to increase this to 40% over next 10 years.
19
Infrastructure expertise
– Learnings from 3 decades of the world‟s largest infrastructure expansion programme
– Increasingly high-tech equipment and processes. E.g. turbines, switch-gear; refineries, railway engines
– Chinese contractors are amongst the most competitive contractors in Emerging Markets driven by a number of factors, includinglow costs (derived from a low cost base), access to financing and strategic support from China Inc.
Financing
– Driven by $2.5 trillion of national foreign reserves, and need to prevent currency appreciation
– China Eximbank will allocate $10bn in soft loans to African projects over next 3 years
– Commercial lending: increasing commercial and project finance loans by Chinese Commercial banks: ICBC, China DevelopmentBank (CDB), China Construction Bank, Bank of China
– Export Credit and PRI cover from Sinosure, China‟s export credit agency
Strategic objectives: an appetite for long-term African risk
– The Chinese Government‟s „Go Global Strategy‟ launched in 2002 aims to create globally competitive players in strategic sectors
– Chinese companies encouraged to expand business with Africa to:
► Secure future supplies of key industrial commodities required for China‟s domestic development needs
► Develop infrastructure projects which support the extraction and export of these commodities from the originating country
► Open up current and future African markets for Chinese consumer and capital goods exports
► Develop Chinese management expertise in overseas business
► Maintain and build closer political relationships with African countries
What solutions do Chinese partners offer Africa’s infrastructure challenges?
20
Chinese lending in Africa is designed to gain access to key markets
Resources
model
Independent
model
China Ex-Im is the key funding institution through which Chinese funding in Africa is channelled
Ex-Im has already extended US$5.5 billion in concessional funding (US$8 billion in additional loans may have goneunannounced)
Ex-Im has an explicit mission to promote trade between China and regions such as Africa
Ex-Im Bank
Chinese financial support is often very attractive - to support trade and facilitate the participation of Chinese construction
companies and SOEs. Use of Chinese equipment and labour are key elements to Chinese funding and are almost as
important as access to resources
Increasingly two models are employed by China in Africa – the “Resources Model” and the “Independent Model”:
Resources model:
– “Resources for infrastructure” in which repayment is effectively made in natural resources
– Loan proceeds are never transferred to the host government:
►a framework agreement is signed covering a program of infrastructure investment;
►government then awards the infrastructure projects (e.g. a new railway line), supported by Ex-Im credit to a
Chinese construction company; and concurrently
►government awards a Chinese company rights to produce oil, or another natural resource;
►purchase of oil/resource also agreed with China thereby facilitating the repayment of the loan
– Funding relatively attractively priced and includes low rates, grace periods and elements of grants and concessional
funding
– Other sweeteners also improve Chinese funding attractiveness - debt relief, ability to rapidly build infrastructure etc
Independent model
– Chinese construction companies – winning construction and equipment supply contracts based on normal fundamentalskills, resources and pricing, which may lead to concurrent / subsequent Chinese funding offers
– Competition tends to come from other Chinese contractors or other foreigners (Brazilian, European, Japanese)
– Local African construction companies rarely compete on larger projects - limited scale, experience or financial standing. Foreign funders (whether Chinese or non-Chinese) will rarely take a risk on local contractors (outside of South Africaand leading Nigerian contractors)
22
Structure is linked to Funding
Given potential project scale, a transaction may seek to attract a Chinese Bid (including Chinese Sponsors, Equipment
Suppliers, Contractors and Financiers). Chinese financiers will likely support a Chinese Bid, if requested.
Equity/ Quasi Equity
Participants (30% – 50%)
Developers
Infrastructure / Private equity funds
Sovereign funds
Operators
Contractor and equipment suppliers
Projects evaluated on Internal Rate of
Return (“IRR”) and Net Present Value
(“NPV”) basis
Debt Participants (50% – 70%)
Export Credit Agencies (ECA‟s)
Infrastructure funds
Development Finance Institutions (DFIs)
International Banks
Nigerian Banks
Sovereign Policy Lenders
Projects evaluated on counterparty credit
quality and debt service coverage ratios
23
Extraction/Processing
ProjectOutputResource
Power
GenerationWater
Fuel
Railway Roads
Ports
Example – Even Mining Projects need Infrastructure
Railway Roads
Issues:
• Often more complex infrastructure
requirements than resource issues
• Locational challenges
• Contractor appetite
• Stakeholder understanding
24
Typical Infrastructure Project Contractual Structure (Wagon Wheel)
Investors Lenders
Contractor(s)
Operator
Shareholders Agreement
Input Supplier
Government
Project Company
e.g. Power Supply Contract
Support Agreement(s)
Operation and
Maintenance Contract
EPC Contracts)
Equity Guarantees Facility
Agreements
Concession Agreement
Security
Agreements
Authority
25
Typical PPP/Infrastructure Project
Sponsor 2
GuaranteeMinistryFinance
Debt
Offtaker / Authority
Sponsor 1
SSA
O&M Contract
Equity Funding+
ESIA
ECAs/Banks
Acknowledgement + Consent
HoldCo
ConsultantEPC
Contract
Contractor
Project Company
Revenue Doc
Land Owner
Land lease
Agmnt
The Financiers Key Focus in
Infrastructure Deals
26
Typical African Infrastructure Project Tender Process: Summary Activities
Estimated
Timeframe:
12 months
PHASE 5
1. Negotiation of
Project
Agreements
2. Achieving
Financial Close
Estimated
Timeframe:
6 months
PHASE 4
1. Bid Evaluation
2. Bid Clarifications
3. Preferred Bidder
selection
Estimated
Timeframe:
6 months
PHASE 3
1. RFP Clarifications
2. Tender Period
- Bid Preparation
- Bid Submission
Estimated
Timeframe:
4 - 6 months
PHASE 2
1. Pre Qualify
Bidders
2. RFP Development
3. RFP Issuance to
Pre Qualified
Bidders
Estimated
Timeframe:
12 months
PHASE 1
1. Prioritise Key
Project
Objectives
2. Agree Project
Concept
3. Obtain
Stakeholder
Approval
Largely due to sub-optimal enabling legislation and regulations, together with limited client capacity and skills, it is not
unusual for African infrastructure projects to take 3-4 years (or longer) to close. It is usual that good projects will
happen eventually but not always in a OECD timeframe
28
Introduction - What can go wrong…..
Many African deals go wrong due to the associated Project inputs / outputs……
The main focus of the Project is only one issue to resolve, all associated inputs (and constituents to output) must also be solved to
ensure project success
If you do not, problems may include:
– Projects sited in the wrong physical location
– Too great a Project inter-dependency to raise third party finance
– Increased environmental emissions and requirement for remedial action
– Unclear business case, thus impeding ability to raise third party finance
– High associated infrastructure expenditure increasing costs
– Ultimately, the risk of Lender dissatisfaction with Project and no Financial Close
29
Disclaimer
Confidentiality and disclaimer
This document is provided on the express understanding that the information contained herein will be regarded and treated as strictly confidential and proprietary to
The Standard Bank of South Africa Limited (“Standard Bank”), its holding company Standard Bank Group Limited, and the subsidiaries of its holding company (“the
Standard Bank group”) . By retaining it the recipient undertakes that it is not to be delivered and nor shall its contents be disclosed to anyone other than the intended
recipient, and nor shall it be reproduced or used, in whole or in part, for any purpose other than for the purpose described herein, without the prior written consent of
Standard Bank.
Whilst every effort has been made to ensure the accuracy and completeness of the information contained in this document, no responsibility is accepted by the
Standard Bank group for the treatment by any court of law, tax, banking or other authorities in any jurisdiction of any transaction based on the information contained
herein. There may be tax implications to consider in any transaction and these should be identified and understood before investing. Separate tax advice should
therefore be sought when appropriate. Should anything contained herein contribute to the acquisition of a financial product the following must be noted: there are
intrinsic risks involved in transacting in any products; no guarantee is provided for the investment value in a product; any forecasts based on hypothetical data are not
guaranteed and are for illustrative purposes only; returns may vary as a result of their dependence on the performance of underlying assets and other variable
market factors and past performances are not necessarily indicative of future performances. Any client that is not a merchant banking client as defined in the
Financial Advisory and Intermediary Services Act must note that unless a financial needs analysis has been conducted to assess the appropriateness of any product,
investment or structure to its circumstances, there may be limitations on the appropriateness of any information provided by a member of the Standard Bank group
and careful consideration must be given to the implications of entering into any transaction, with or without the assistance of an investment professional.