Clifford Capital’s Bayfront Infrastructure Management achieves financial close for Bayfront Infrastructure Capital V USD 508.3 million infrastructure asset-backed securities: GuarantCo guarantees Class D tranche subscribed by the Bank of the Philippine Islands and Chandra Asri Trading Company Pte. Ltd.

  • Date written
  • July, 2024

  • Bayfront Infrastructure Capital V (BIC V) is the second collaboration between Bayfront and GuarantCo, part of the Private Infrastructure Development Group.
  • GuarantCo guarantees the mezzanine debt tranche within the capital structure (Class D for this issuance), which is fully subscribed by the Bank of the Philippine Islands (BPI) and Chandra Asri Trading Company Pte. Ltd. (CATCO), helping to support the financing or refinancing of sustainable infrastructure projects in Asia.
  • This is the first time that BPI and CATCO have invested in a debt issuance guaranteed by GuarantCo.

Clifford Capital’s Bayfront Infrastructure Management achieves financial close for Bayfront Infrastructure Capital V USD 508.3 million infrastructure asset-backed securities: GuarantCo guarantees Class D tranche subscribed by the Bank of the Philippine Islands and Chandra Asri Trading Company Pte. Ltd.

Clifford Capital, a leading infrastructure debt financing platform based in Singapore, is pleased to announce the successful achievement of the Group’s fifth public infrastructure asset-backed securities (IABS) transaction and its largest to date.

BIC V is a wholly owned and newly incorporated distribution vehicle of Bayfront Infrastructure Management (Bayfront), a subsidiary of Clifford Capital.

Through the issuance of IABS, Bayfront offers investors exposure to a diversified portfolio of project and infrastructure loans across multiple geographies and sectors, and through this transaction GuarantCo is furthering its work to enhancing secondary market liquidity in its target markets. Bayfront and its IABS product help to address the infrastructure financing gap in Asia Pacific by mobilising institutional capital for project and infrastructure debt. IABS further address the limited investment grade opportunities in emerging markets infrastructure for institutional investors and provide banks an effective avenue for recycling capital into new projects.

Whilst the Class A1, Class A1-SU, Class B and Class C Notes are rated investment grade by Moody’s and would be listed on the Singapore Exchange, the Class D Notes (amounting to USD 20.3 million), which are unrated and unlisted, benefit from a guarantee from GuarantCo (rated A1 by Moody’s and AA- by Fitch) for principal and interest amounts payable. The provision of the guarantee by GuarantCo in relation to the Class D Notes helps to support the financing or refinancing of sustainable infrastructure projects and infrastructure debt as permitted by PIDG’s investment policy.

BIC V features a portfolio size of approximately USD 508.3 million spread across 37 individual loans and bonds 36 projects, 15 countries and 10 industry sub-sectors. Amongst all IABS issued to date, BIC V has the highest proportion of sustainable assets, with a total commitment amount of USD 218.4 million of eligible green and social assets, as defined under Bayfront’s Sustainable Finance Framework which represent 43 percent of the total portfolio commitment amount.

Nicholas Tan, Chief Executive Officer of Bayfront, said:

“We are pleased that the IABS programme continues to help facilitate institutional participation in infrastructure debt as an asset class. We are proud to partner with GuarantCo / PIDG again to enhance our IABS programme, and our fifth public IABS issuance, with a significant over-subscription rate, firmly validates robust demand from infrastructure investors to access this attractive investment opportunity.”

Layth Al-Falaki, Chief Executive Officer of GuarantCo, said:

“We are delighted to have provided a guarantee to an international asset backed securitisation structure for the second time following our first transaction in September 2023. The transaction presents a sustainable solution to support the building of green and social assets in the region. Our involvement in this novel asset class further strengthens our strategic ambition to mobilise private sector institutional capital, help develop secondary markets for such products and to continue to bridge the infrastructure financing gap to the benefit of local capital markets and the local people. This also aligns well with GuarantCo’s strategy of doing replicable transactions to help create scale and further mobilise and crowd-in private sector capital”

Andre Khor, Chief Financial Officer of Chandra Asri Group, said:

“Chandra Asri’s investment in Clifford Capital’s Bayfront Infrastructure Capital V Pte. Ltd. (BIC V) is another testament of our strong confidence in this asset class, as we look to realise the strategic growth aspirations of our infrastructure business. Our Group is committed to supporting green and sustainable infrastructure projects. Chandra Asri’s robust cash balance enables us to make substantial investments with confidence, to achieve our overarching goal of high-impact social and economic investing.”

Eric Luchangco, Chief Finance Officer and Chief Sustainability Officer of BPI, said:

“We are pleased to be part of this meaningful transaction, which aligns with BPI’s commitment to sustainable finance. By investing in Bayfront Infrastructure Capital V’s IABS Class D tranche, which is backed by GuarantCo, we are supporting the development of sustainable infrastructure projects that will have a lasting, positive impact on communities across Asia Pacific in particular. This subscription underscores BPI’s dedication to driving growth through responsible and impactful investments.”

NOTES TO EDITORS

About Bayfront Infrastructure Management

Bayfront Infrastructure Management is a Singapore-based platform with a mandate to invest in and distribute project and infrastructure loans in Asia Pacific and Middle East regions.

Bayfront previously structured and placed four transactions – Bayfront Infrastructure Capital (BIC) in July 2018, Bayfront Infrastructure Capital II (BIC II) in June 2021, Bayfront Infrastructure Capital III (BIC III) in September 2022 and Bayfront Infrastructure Capital IV (BIC IV) in September 2023.

 

It was established in 2019 in connection with the Infrastructure Take-Out Facility initiative sponsored by the Government of Singapore, which was designed for institutional investors to access Asia Pacific infrastructure debt. It seeks to address the infrastructure financing gap in the Asia-Pacific region by facilitating the mobilisation of private institutional capital into the infrastructure financing market.

 

Bayfront’s business model is to acquire infrastructure debt, as well as structure, execute and manage securitisations (through its Infrastructure Asset Backed Securities product) or other forms of distribution to institutional investors.

 

Bayfront is capitalised at USD 1.98 billion, comprising USD 180 million in equity and USD 1.8 billion in debt issuance capacity. The equity capital is committed by Clifford Capital Holdings and the Asian Infrastructure Investment Bank on a 70/30 basis respectively. Debt instruments issued by Bayfront to acquire and warehouse loans from banks benefits from a guarantee provided by the Government of Singapore.

About GuarantCo

GuarantCo mobilises private sector local currency investment for infrastructure projects and supports the development of financial markets in lower income countries across Africa and Asia. GuarantCo is part of the Private Infrastructure Development Group (PIDG) and is funded by the governments of the United Kingdom, Switzerland, Australia and Sweden, through the PIDG Trust, the Netherlands, through FMO and the PIDG Trust, Canada, through the PIDG Trust and a repayable facility, plus France through a stand-by facility. GuarantCo is rated AA- by Fitch and A1 by Moody’s. Since 2005, GuarantCo has enabled USD 6.2 billion of total investment and USD 5.2 billion of private sector investment, giving 45.2 million people improved access to infrastructure and creating around 229,000 jobs. GuarantCo’s activities are managed by GuarantCo Management Company which is part of Cardano Development. www.guarantco.com

About PIDG

The Private Infrastructure Development Group (PIDG) is an innovative infrastructure project developer and investor which mobilises private investment in sustainable and inclusive infrastructure in sub-Saharan Africa and south and south-east Asia. PIDG investments promote socio-economic development within a just transition to net zero emissions, combat poverty and contribute to the Sustainable Development Goals (SDGs). PIDG delivers its ambition in line with its values of pioneering, partnership, safety, inclusivity and urgency.

 

 PIDG offers Technical Assistance for upstream, early-stage activities and concessional capital; its project development arm – which includes InfraCo Africa and InfraCo Asia – invests in early-stage project development and project and corporate equity. PIDG credit solutions include EAIF (the Emerging Africa Infrastructure Fund), one of the first and more successful blended debt fund in low-income markets; GuarantCo, its guarantee arm that provides credit enhancement and local currency solutions to de-risk projects; and a growing portfolio of local credit enhancement facilities, which unlocks domestic institutional capital for infrastructure financing.

 

Since 2002, PIDG has supported 233 infrastructure projects to financial close, which provided an estimated 228 million people with access to new or improved infrastructure. PIDG is funded by the governments of the United Kingdom, the Netherlands, Switzerland, Australia, Sweden, Global Affairs Canada, Germany, and the IFC. pidg.org

About BPI

The 172-year-old Bank of the Philippine Islands (BPI) is the first bank in the Philippines and Southeast Asia. BPI is licensed as a universal bank by the Bangko Sentral ng Pilipinas to provide a diverse range of financial services: deposit taking and cash management, payments, lending and leasing, wealth management, bancassurance, investment banking, securities brokerage, foreign exchange, and treasury. BPI has investment-grade ratings of BBB+ (S&P), baa2 (Moody’s), BBB (Capital Intelligence), and BBB- (Fitch).

About Chandra Asri Group

Chandra Asri Group is Indonesia’s leading chemical and infrastructure solutions company, supplying products and services to various strategic industries in both domestic and international markets. With a history of more than 31 years and over 2,200 dedicated staff, it incorporates state-of-the art technologies and supporting facilities located strategically in the country’s industrial hubs, Cilegon, and Serang. In our efforts to achieve our Environmental, Social, and Governance (ESG) goals, we have focused on operational excellence to tackle challenges through our Sustainability Framework “RESPONSIBLE”. Chandra Asri Group is committed to making a positive impact on society and the environment, adopting a holistic approach that integrates business sustainability with social and environmental welfare.