Narrative
Full Description
Project narrative
On December 16, 2015, Chinese state-owned enterprise State Power Investment Corporation Limited (SPIC) entered into an share sale agreement with IFM Investors Ltd. in which SPIC would acquire 100% of the equity of Australian renewable energy company Pacific Hydro Pty Ltd from IFM. Then, in late January 2016, seven banks — including the Sydney Branch of China Construction Bank Corporation (CCB), Bank of China (BOC), Bank of Communications (BoComm), Industrial and Commercial Bank of China (ICBC) — entered into two syndicated bridge loans, totaling $2.5 billion USD, with an unspecified Australian subsidiary of SPIC to finance the entire cost of SPIC's acquisition of Pacific Hydro. The two syndicated loans consisted of a loan with a $1 billion AUD facility tranche and a $950 million USD facility tranche provided by a three-bank syndicate and a $750 million USD loan provided by a five-bank syndicate. Both loans had a maturity period of 12 months (one year). SPIC provided parent guarantees for the debt. The acquisition was completed on January 28, 2016. There were seven lenders to these two syndicate loans: the Sydney Branch of CCB, BOC, BoComm, ICBC, Banco Santander, S.A., DBS Bank, and Société Générale S.A. (SocGen). CCB served as the sole arranger, agent, and major lender for the syndicated loans. As major lender, CCB contributed half of the combined loan volume — approximately $1.25 billion USD — of the two loans. Record ID#49844 captures CCB's contribution. Record ID#95643 captures BOC's contribution. Record ID#95644 captures BoComm's contribution. Record ID#95645 captures ICBC's contribution. Then, in late January or early February 2017, a syndicate of banks — including BOC, CCB, ICBC, and Australia and New Zealand Banking Group (ANZ), acting as joint mandated lead arrangers — signed a $1.6 billion AUD syndicated facility loan agreement with SPIC Pacific Hydro Pty Ltd. The proceeds of this loan were used to refinance the January 2016 facilities and for general corporate purposes. Record ID#95647 captures BOC's contribution. Record ID#95648 captures CCB's contribution. Record ID#95649 captures ICBC's contribution. Then, in January 2020, a syndicate of banks entered into a three-year $1.6 billion AUD loan with Pacific Hydro to refinance its debt. This loan carried a maturity period of three years and was at swaps plus 0.9% percent. Then, in late January 2023, a syndicate of banks — including BOC, CCB, BoComm, ICBC, and China Merchants Bank — entered into a $1.5 billion AUD syndicated facility with Pacific Hydro to refinance the previous facility. BOC and CCB served as arrangers. The proceeds of the loan were to be used for general corporate purposes. Record ID#95650 captures BOC's contribution. Record ID#95651 captures BoComm's contribution. Record ID#95652 captures CCB's contribution. Record ID#95653 captures China Merchants Bank's contribution. Record ID#95654 captures ICBC's contribution.
Staff comments
1. The specific breakdown of the contributions of the seven to these two syndicated loans is unknown. It is known only three banks contributed to the $750 million USD loan, while five banks contributed to the loan with $1 billion AUD facility tranche and a $950 million USD facility tranche. However, AidData has only been able to confirm that CCB contributed to both loans and that it provided half of the $2.5 billion USD aggregate figure of both loans (see "China's State Power buys Australian wind farm for $227million: sources"); AidData has not yet identified which loan(s) the other six lenders contributed to. Without knowing the individual lenders to the two loans, AidData has thus treated this project as one large loan. It has coded CCB's contribution as $1.25 billion USD, as this is 50% of $2.5 billion USD, and, for the remaining six lenders (including BOC, BoComm, and ICBC), it has assumed those six lenders contributed equally ($208,333,333.333 USD) to the remaining $1.25 billion USD of these loans. This issue merits further investigation. 2. At the time of the acquisition, Melbourne-based Pacific Hydro Pty Ltd. had 19 electric and wind facilities in Australia, Brazil and Chile, including five operating hydro plants in Chile and two wind farms in Brazil, totaling 900 MW with a further 1.8 GW in development (see "SPIC's acquisition of Pacific Hydro awarded Cross-Border M&A Deal of the Year" and "China's State Power buys Australian wind farm for $227million: sources").