What is Project Finance?
Project debt financing is a fixed-income instrument which relies solely on the ability of the project cash flows to repay the amounts borrowed. It has limited or no recourse to its shareholders and is secured only against the assets and the revenues that underpin the relevant project.
This form of financing matches the tangible, immovable and capital-intensive nature of projects, which demand a significant level of investment that needs to be committed upfront with the expectation of achieving pay back over a long-term horizon.
Infrastructure Project Finance services covers:
- Social (Hospitals, schools and sports area)
- Transport (Roads, bridges, railways, pipelines, ports and airports)
The volume of the capital needed for a widespread transition towards an energy economy will require increasing participation of financial institutions and investors. Also, it requires the continued adoption of innovative financing techniques.
None-recourse debt financing of projects has certain characteristics that have allowed it to be perceived as resilient in investment for commercial banks, this does not mean that it is exempt from credit risk. Commercial banks have traditionally focused on the lower end of the risk spectrum lending only to established technologies with a minimum level of operational track record.
Private equity firms and venture capitalists devote their resources to new investments with high return prospects, undertaking a significant amount of risk of failure which they seek to diversify through a portfolio approach.
To discuss your financing options, please contact us directly.