Bank of China contributes to a $440.5 million AUD syndicated loan to Alinta Energy for the Loy Yang B Power Plant Refinancing Project (Linked to Record ID#94376, #94379 and #94380)

Project narrative

On November 23, 2017, Chow Tai Fook Enterprises, owner of Alinta Energy, entered into a conditional binding agreement to purchase the total share in the Loy Yang B Power Plant from its owners ENGIE S.A. (70%) and Mitsui & Co. (30%) for a consideration of approximately $1.2 billion AUD. Then, on January 15, 2018, financial close was reached on the acquisition. To help finance the acquisition, a syndicate of seven banks — including the Bank of China (BOC) — provided a $715 million AUD syndicated loan to Latrobe Valley Power (Finance) Pty Ltd — a special purpose vehicle (SPV) that is wholly owned by Alinta Energy — for the Loy Yang B Power Plant Acquisition Project. This loan carried a maturity period of five years, an interest rate based on BBSY plus a margin of 235 basis points (bps), and a 40% commitment fee of the margin. The borrower used the proceeds of this loan to support its purchase of the 1050 MW Loy Yang B Power Plant. It is Victoria's newest and most efficient coal plant, generating ~17% of Victoria's power. BOC provided $79.6 million USD in debt financing to the syndicate. Record ID#94376 captures BOC's contribution. Then, on March 30, 2021, financial close was reached on a deal in which a syndicate of seven banks — including the Bank of China (BOC), China Everbright Bank, and China Merchants Bank Co., Ltd. — provided a $440.5 million AUD syndicated loan to Alinta Energy Pty Limited for the Loy Yang B Power Plant Refinancing Project. The proceeds were used by the borrower to refinance the $715 million AUD acquisition loan that was used to purchase the Loy Yang B Power Plant. The coal-fired 1050 MW Loy Yang B is located in the Latrobe Valley in the State of Victoria. It is Victoria's newest and most efficient coal plant, generating ~17% of Victoria's power. BOC's contribution to the loan is captured by Record ID#94378. China Everbright's contribution to the loan is captured by Record ID#94379. China Merchant Bank's contribution to the loan is captured by Record ID#94380. In addition to BOC, China Everbright, and China Merchants Bank, the following banks participated in this syndicated loan: China Minsheng Banking Corp Ltd (CMBC), Standard Chartered Bank PLC, Australia and New Zealand Banking Group (ANZ), and DBS Bank. BOC, China Everbright, and CMBC served as mandated lead arrangers and bookrunners; China Merchants, Standard Chartered, ANZ, and DBS joined at lower levels. Among the syndicate members, there were three noteworthy absences, three of existing lenders of the $715 million AUD acquisition loan – Intesa Sanpaolo S.p.A., Sumitomo Mitsui Banking Corporation (SMBC), and UOB-Kay Hian Holdings Ltd. – which all dropped out from the $440.5 million AUD refinancing on plant on environmental grounds.