Project Gemini mandates commercial lenders
Friday, Jan 31, 2014Project Gemini is pleased to announce that it has received commitments for EUR 1,094 million in senior secured construction and term debt from 10 international commercial banks and Export Development Canada (EDC).
Project Gemini is a 600 MW offshore wind farm in the Dutch North Sea, developed by Typhoon Offshore B.V., that, subject to the approval of each sponsor's board, will be owned by Northland Power Inc. (60%), Siemens Financial Services (SFS - 20%), Van Oord Dredging and Marine Contractors BV (10%), and N.V. HVC, a joint venture of 48 Dutch municipalities and six water regulatory authorities (10%). In association with a EUR 500 million facility expected to be provided by the European Investment Bank and export credit cover under negotiation and subject to credit approval with three European export credit agencies (Denmark's EKF, Germany's Euler Hermes and Belgium's Delcredere-Ducroire), the EUR 1,094 million of commercial bank risk commitments completes the up to EUR 2,226 million of senior debt required by Project Gemini.
Project Gemini has executed mandate letters appointing eight banks as Mandated Lead Arrangers. These are Dutch bank ABN AMRO Bank N.V., France's BNP Paribas and Natixis, Japan's The Bank of Tokyo-Mitsubishi UFJ, Ltd and Sumitomo Mitsui Banking Corporation, and Canada's Export Development Canada, CIBC World Markets plc and Bank of Montreal. Spain's Banco Santander SA and CaixaBank SA have been appointed as Mandated Arrangers. Of the mandated banks, the Gemini project team appointed SMBC as Facility Agent and ECA Agent and ABN AMRO as Account Bank and LC Issuing Bank. BNP Paribas will act as Documentation Bank, BTMU as Technical bank, Natixis as Market Due Diligence Bank and Santander as Insurance Bank.
Late last year, the Gemini project team announced that the Danish pension group PKA and Northland Power, the lead equity sponsor in Gemini, will fund the EUR 200 million subordinated loan layer. With the subordinated debt and senior debt now lined up, the Gemini project team is now negotiating the final details of the transaction.
The financing will be, by far, the largest ever to be closed in the wind sector and Project Gemini is very pleased to be supported by such a strong bank group. The substantial underwriting commitments obtained underline the willingness of the banking market to provide non-recourse construction finance to the offshore wind sector for well-structured projects, and signal a new era where underwritings can be available for the industry.
The wind farm is expected to reach commercial operations in the summer of 2017.
Project Gemini is advised by Green Giraffe Energy Bankers (financial advisor), Clifford Chance LLP, Amsterdam (legal advisor), AON Risk Solutions (risk management and insurance), Loyens & Loeff (tax) and Chatham Financial (hedging). The lenders are advised by Mott MacDonald (technical), Allen & Overy (legal), Poyry Management Consulting (market), Benatar & Co Ltd (insurance), and Corality Financial Group (model audit). Additionally, the EIB is advised by Freshfields Bruckhaus Deringer LLP (legal), EKF and Delcredere-Ducroire are advised by Kromann Reumert (legal), and Euler Hermes supported by EY/AHB acting as independent Chartered Auditor for the Federal German Government).