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GuarantCo, part of the Private Infrastructure Development Group (PIDG), has closed its first syndication transaction via the credit insurance market with leading Lloyd’s (re)insurer Canopius, which was arranged by specialist CPRI broker BPL Global. The transaction involved the use of a non-payment insurance policy covering exposure on a GuarantCo portfolio transaction.
The project will improve Pakistan’s power sector efficiency by producing clean and green power near the point of usage, thus reducing wastage and line losses associated with the national grid and by stabilising the grid at peak times. Shams Power helps to reduce carbon emissions and has a positive impact on mitigating climate change through the provision of clean, sustainable solar power.
This transaction has the potential to transform the rooftop solar market in Pakistan by demonstrating the ability for rooftop solar providers to access debt funding locally; this will allow for developers to scale up to unlock more solar potential. The transaction also builds the capacity of energy regulators and the State Bank of Pakistan (SBP), allowing them to create a supportive and practical regulatory and financial framework whilst also building the capacity of banks who are new to this asset class. Shams is also committed to continue the provision of training and potential employment opportunities to female engineers as the company grows.
Business and institutional users will benefit from lower electricity costs through the rooftop systems installed without incurring any upfront capital expenditure. The proposed solution also increases users’ electricity reliability and reduces their reliance on back-up diesel generators. Given climate considerations and business continuity reasons, Shams Power’s solution represents an efficient alternative to existing solutions. In addition, the transaction will lead to long-term job creation in the project value chain and 60 local permanent jobs have been created by Shams Power.
The contingent credit solution of GuarantCo collaborates with Axis Bank, India’s third largest private sector bank, to provide Northern Arc Capital with INR 3.25 billion (c. USD 40 million) to ensure increased access to finance for underbanked borrowers in India. GuarantCo’s transaction will support Northern Arc to sustainably grow its loan portfolio within specific sectors such as microfinance, small business enterprises, commercial vehicle financing, affordable housing and education.
GuarantCo, part of the Private Infrastructure Development Group (PIDG), collaborates with Axis Bank, India’s third largest private sector bank, to provide Northern Arc Capital with INR 3.25 billion (c. USD 40 million) to ensure increased access to finance for underbanked borrowers in India.
GuarantCo and African Guarantee Fund (AGF) have provided GreenYellow, with a credit guarantee of MGA 33 billion (c. EUR 7.1 million) with a nine-year tenor to a syndicate of local banks to finance a 20 MW solar plant extension alongside a 5 MW solar battery storage system in Ambatolampy, Madagascar. Société Générale acted as the main lender. GuarantCo provided a guarantee of MGA 23.6 billion (EUR 5 million) and AGF a guarantee of MGA 9.4 billion (EUR 2 million). This is the second phase of an existing 20 MW solar power plant operation that GuarantCo and AGF helped refinance in 2020.
GuarantCo, part of the Private Infrastructure Development Group (PIDG), and African Guarantee Fund (AGF) have provided GreenYellow, with a credit guarantee of MGA 33 billion (c. EUR 7.1 million) with a nine-year tenor to a syndicate of local banks to finance a 20 MW solar plant extension alongside a 5 MW solar battery storage system in Ambatolampy, Madagascar. Société Générale acted as the main lender. GuarantCo provided a guarantee of MGA 23.6 billion (EUR 5 million) and AGF a guarantee of MGA 9.4 billion (EUR 2 million). This is the second phase of an existing 20 MW solar power plant operation that GuarantCo and AGF helped refinance in 2020.
Swedish International Development Cooperation Agency (Sida) has provided GuarantCo, the guarantee arm of the Private Infrastructure Development Group (PIDG), with a USD 100 million (in Swedish Krona equivalent) 20-year re-guarantee facility to increase GuarantCo’s capacity to facilitate infrastructure financing solutions and further build local capital markets to the benefit of companies and people in lower income countries across Africa and Asia.
GuarantCo provided a USD 24 million guarantee for an innovative dual tranche bond issued by Royal Railway, split equally between 5 years and 10 years. The features of this bond have the potential to be transformational in facilitating future infrastructure funding through domestic capital markets in the country. The bond investors included Prudential (Cambodia) Life Assurance PLC and Manulife (Cambodia) PLC. SBI Royal Securities, a leading securities firm in Cambodia, acted as the sole mandated lead arranger of the bond. It is the first floating-rate 10-year bond subscribed by domestic insurance companies and the first listed infrastructure bond in Cambodia.
GuarantCo provided Orabank Côte d'Ivoire with a five-year, XOF 10 billion (c. USD 15 million) portfolio guarantee to enable the bank to grow its infrastructure-related portfolio across the region. It is GuarantCo’s first transaction in Côte d'Ivoire and its second with Oragroup, after providing a XOF 14.55 billion (c. USD 25 million) portfolio guarantee to Orabank Togo (an Oragroup subsidiary) in January 2022. In the West African Economic Monetary Union (WAEMU) countries, the implementation of Basel II and III banking regulations have limited the lending capacity of banks to infrastructure projects. The portfolio guarantee will help Orabank achieve capital relief, increase their lending capacity, and comply with single obligor limits. GuarantCo expects this transaction to be replicated with other lenders to ensure that infrastructure project financing is not compromised whilst necessary prudential safeguards are implemented.
- First floating-rate 10-year bond subscribed by domestic insurance companies
- First listed infrastructure bond in Cambodia
- Rated AAA by the Rating Agency of (Cambodia) Plc
GuarantCo Management Company (GMC), GuarantCo’s fund manager and a subsidiary of Cardano Development, has appointed Surabhi Mathur Visser as Chief Investment Officer (CIO), effective 3rd January 2023, to ensure that GuarantCo, a Private Infrastructure Development Group (PIDG) company, is well prepared to deliver against future growth opportunities to the benefit of local people across Africa and Asia.
- First GuarantCo transaction in Côte d'Ivoire
- Second GuarantCo transaction with Oragroup in West Africa
