ICBC contributes $4.72 million AUD to the $37.80 million AUD tranche of a $1.4041 billion AUD syndicated loan for the High Capacity Metro Trains (HCMT) Project (Linked to Record ID#95337, #95338, #95339, #95340, and #95341)

Project narrative

On November 24, 2016, financial close was reached on a deal in which a syndicate of eight lenders — including the Bank of China (BOC), the Bank of Communications (BoComm), and the Industrial and Commercial Bank of China (ICBC) — entered into a $1.4041 billion AUD ($1.03515 billion USD) syndicated loan agreement with Evolution Rail Finance Pty Ltd — a special purpose vehicle (SPV) and joint venture of Partners Group (49.9% ownership stake), Plenary (30.1% ownership stake), Downer (10% ownership stake), and CRRC (10% ownership stake) — for the High Capacity Metro Trains (HCMT) Project. This $1.404 billion AUD loan was divided into two term loan tranches: a $1.3663 billion AUD ($1.00728 billion USD) tranche and a $37.80 million AUD ($27.87 million USD) tranche. Both tranches carried a maturity period of eight years and eight months (8.66 years) and a maturity date of August 8, 2025. Each lender, including the three Chinese banks, contributed $170.79 million AUD ($125.91 million USD) to the $1.366 billion AUD tranche and $4.72 million AUD ($3.48 million USD) to the $37.8 million AUD tranche. In addition to the three Chinese banks, the following lenders contributed to the syndicated loan: Mizuho Bank, Hong Kong and Shanghai Banking Corporation Limited, Intesa Sanpaolo S.p.A., United Overseas Bank Limited (UOB), and Westpac Banking Corporation. Record ID#95337 captures BOC's contribution to the $1.3663 billion AUD tranche. Record ID#95338 captures BoComm's contribution to the $1.3663 billion AUD tranche. Record ID#95339 captures ICBC's contribution to the $1.3663 billion AUD tranche. Record ID#95340 captures BOC's contribution to the $37.80 million AUD tranche. Record ID#95341 captures BoComm's contribution to the$37.80 million AUD tranche. Record ID#95342 captures ICBC's contribution to the $37.80 million AUD tranche. In addition to the debt, the sponsors contributed $596.00 million AUD ($439.39 million USD) in equity, with $297.40 million AUD ($219.26 million USD) from Partners Group, $179.40 million AUD ($132.26 million USD) from Plenary Group, $59.60 million AUD ($43.94 million USD) from Downer, and $59.60 million AUD from CRRC. The sponsors did so through their equity vehicles, namely Partners Group Access 816 L.P., Plenary Investments (HCMT) Pty Ltd, Downer EDI Associated Investments Pty Ltd, and CRRC Changchun Railway Vehicles Co., Ltd. The HCMT Project had a total cost of $2.3 billion AUD (approximately $1.8 billion USD). The proceeds of this loan were used to support High Capacity Metro Trains (HCMT) Project, a Public Private Partnership (PPP) project in Melbourne, Victoria. On November 21, 2016, the State Government of Victoria entered into a PPP contract with Evolution Rail Pty Ltd to procure and deliver the HCMT Project an ‘availability–based’ PPP, in which Evolution Rail would be responsible for the design, construction, maintenance and financing of 65 High Capacity Metro Trains (HCMTs) and a range of ancillary activities to support the maintenance and operation of said trains. Evolution Rail would be responsible for maintenance for a 30-year concession. The State Government of Victoria would make partial service payments from the entrance into service of the fifth HCMT until the provisional acceptance of all 65 HCMTs, from which quarterly service payments would begin. The State Government of Victoria later entered into an $123 million AUD agreement for the delivery of five additional HCMT to service Melbourne Airport Rail Link, bringing the total fleet to 70. Specifically, the HCMT Project involved the design, manufacture, and commissioning of 65 HCMTs to serve the Cranbourne-Pakenham line, and, following the completion of the Metro Tunnel, the Cranbourne-Pakenham to Sunbury corridor of Melbourne's rail network; the design, construction, and commissioning of the Pakenham East train depot and its train maintenance facility (TMF) and stabling yard, a light service facility (LSF) in Calder Park and two simulators; the transfer of the Pakenham East stabling yard to the Victorian State Government upon the achievement of provisional acceptance of the depot; the maintenance of the train fleet, the TMF, the LSF, and the simulators; the operation of the TMF, the LSF and the simulators; the provision of HCMTs to the franchisee; the provision of private sector finance necessary for the project; and the provision of an option for the purchase of an additional 35 HCMTs. The HCMT Project was supported by included extensions to platforms at 13 stations, the construction of five new stations, removal of crossings, redoing of power lines, upgrading of substations, and the commissioning of a train signaling system along the Cranbourne-Pakenham line under the $1.6 billion AUD ($1.28 billion USD) Caulfield to Dandenong Level Crossing Removal Project. The HCMT Project was expected to increase the Cranbourne-Pakenham line's capacity by 42%, capable of accommodating 11,000 additional passengers during peak times. The HCMTs, based on the A-Type platform operating on Hong Kong's Mass Transit Railway (MTR), consisted of seven-cars each, configured as one, single long vehicle. Each train had a designed maximum passenger capacity of 1,380, with 28 wheelchair spaces. The project wa salso expected to create 1,100 full-time local jobs. Downer EDI Rail Pty Ltd and CRRC Changchun Railway Vehicles Co., Ltd, working as an unincorporated joint venture, were responsible for the design and construction of the HCMTs, the simulators, the TMF, and the LSF. Downer EDI Works Pty Ltd was subcontracted to design and construct the train depot and LSF. CRRC Changchun Australia Pty Limited was subcontracted to design and construct the HCMTs. Downer Victoria PPP Maintenance Pty Ltd was contracted to operate, maintain, and repair the assets of the project. Metro Trains Melbourne Pty Ltd., the operator of the Melbourne rail network and franchisee of the project, was responsible for coordination of various activities with Evolution Rail. Mott McDonald Australia Pty Ltd was appointed by the State Government of Victoria and Evolution Rail to oversee the design and construction of the project. Hofmann Engineering won a subcontract from CRRC for the manufacture and supply of 900 bogie frames for the project. Civilex was subcontracted by Downer for bulk-earthworks, internal roads, and drainage works for the depot and TMF. Andrew Engineering won a contract for the supply, installation, and commissioning of the wheel lathe equipment for the train depot. Under the PPP contract, the provisional acceptance of the train depot was due December 14, 2018 and the provisional acceptance of the first HCMT and commencement of revenue service was due March 29, 2019. Provisional acceptance of the HCMT fleet and the entire HCMT Project was July 18, 2023, with final acceptance due January 29, 2024. The PPP contract would expire on July 18, 2053. Early construction works began in December 2016 at the Pakenham East depot, with major construction beginning in the first half of 2017. Train design was finished in early 2018, and the first train was delivered for testing in November 2018. The Pakenham East depot was complete in December 2018. The first HCMTs were expected to serve the Cranbourne-Pakenham in 2019, but revenue service was delayed with a new expected start by the end of 2020 after testing. The final HCMT was expected to be delivered in 2023.