Comprehensive course analysis
Who should attend
The course will be valuable to professionals in the following areas:
- Bankers/Investment Bankers /Financial Advisors
- Sponsors/Project Joint Ventures
- Project Developers
- Government/PPP Agencies
- Public Sector Managers
- Accountants/Taxation Advisers
- Share Market Analysts/Brokers
- Privatization Executives
- Company Treasurers/Directors
- Credit Committee Staff
- Rating Agencies
- Project Managers/Engineers
- Project Consultants
About the course
Examines the latest structuring, funding & cash-flow modelling techniques
Infrastructure development is essential to sustaining economic growth and improving competitive position in today’s global markets. Traditional public sector funding sources may be constrained when financing infrastructure facilities. Innovative approaches to funding such services, as well as programs for Public Private Partnerships (PPPs), have been endorsed by many countries as means of accelerating delivery. An essential element of PPP is the desire to link public sector accountability with private sector discipline, expertise, efficiency and financial resources. This is equally true in industrialized and emerging markets. In this hands-on program participants will become familiar with the array of PPP models from Supply and Service Contracts, Management Agreements, Leasing, DBFO, BOT, BOO, Privatization and a continuum of other approaches. They will see how the concept of balancing risk and “value for money” is central to governmental policy and decision-making. They will also consider the outlooks of various stakeholders creditors and guarantors of projects, when approaching PPP transactions.
While differentiating between countries and sectors this program is designed to help participants break the project analysis process into its component parts and evaluate the roles played and sources of support provided by many parties. Techniques for assembling information and making qualitative judgments are described. Tools used to conduct careful quantitative financial analysis are explained thoroughly. Cases and examples from around the world that have successfully weathered difficult markets, as well as some that have deteriorated or failed, are used to ensure understanding and give participants practice in the application of concepts. In this program attention is also given to techniques for sourcing and enhancing the terms of funding both in domestic and international projects. Elements unique to both bank and capital markets when financing projects in transport, social services, and water sectors are highlighted. Public and private credit enhancers are also identified and described.
- Availability vs, Concession Models of PPP
- Structuring Transactions and Anticipating Problems
- Power Projects, Transport, Social Infrastructure and Water
- Sources of Finance: Banks, Capital Markets
- Rating Agency Considerations
- Credit Enhancement Techniques
- Private Equity and Other Investment Funding
Distinctive Features of International Projects in Emerging Markets
- Energy Structures
- Roads, Rail, Ports and Airports
- Water Distribution and Sanitation
- Hospitals, Schools and Other Social Infrastructure
The course us heavily reliant upon cases and examples and reinforce understanding and ensure application of concepts.
Themes: Approaches to Funding Infrastructure
Overview of Public Private Partnership (PPP) and Approaches
- Public Private Partnerships (PPP) Principles
- Different Structures and Degrees of Public vs Private Participation
- Contract Services: Operations and Maintenance (O&M)
- Leasing: Lease Develop Operate (LDO
- Design Build: DB, DBM, DBO, DBFO
- BOT, BOO Concessions vs. Privatization
- Market evolution: Power Generation to Social Infrastructure
Managing and Allocating Risks in PPP To Make a Deal “Bankable”
- Collecting Information: Macro and Micro Concerns
- Risk Allocation and Mitigation Techniques in PPP
- Developing a Specialized Matrix
- Analyzing Risk Assumptions (Shareholders, Construction, Operating and Maintenance, Financial, Political)
- Environmental Considerations
- Consultants in the PPP Process
Project Structures and Origins
- Earliest Examples of Market Liberalization: Power
- Fragmentation of Electricity Generation
- What Drives the Investment
- Government Incentives
Quantitative Risk Analysis and Cashflow Forecasts
- Debt vs Equity and Key Measurements
- Probabilistic Modeling
- Testing Sensitivities
- Requirements of Creditors vs Investors
- Other Stakeholder Considerations
Case Examples: Power and Transport Risk allocation among various project participants.
Themes: Public Tendering; Roads, Railways and Lightrails
Funding Roads and Other Transport Projects
- Different Structures and Degrees of Private Participation
- Long-term Concessions and “Availability” Arrangements
Case-Study: Using DBFO Structuring for a Toll Road Project Participants will break into groups to evaluate the DBFO financing scheme for a toll road. They will assess the allocation of risks, and concession terms, and other contractual agreements.
PPP Tender Process Other Contractual Issues
- User Needs in Output Terms
- Private Sector Informational Requirements
- Identifying Bidders, Negotiating Strategies and Closing
- Regulatory Framework and Enforceability
- Policy Objectives of the Government
- Concessions and Licensing, Process and Oversight
- “Value for Money” and the Public Sector Comparator (PSC)
- Unitary Payments (UPs)
Case-Example: Canada Line Rapid Transit PPP and Rapid Transit Projects. Phases of the selection process. Public Sector Comparator and risk assessment.
Sources of Funds
- Using Bank Debt
- Club Deals, Syndications and Secondary Market Resale
- Term Sheets, Information Memoranda and Credit Agreements
- Conflict Resolution
- Credit Enhancement
Case Study: Railway Upgrade Participants will break into groups to evaluate the financing scheme for this railway upgrade. They will assess the allocation of risks, and concession terms, and other contractual agreements. A cash flow model will be used to test qualitative assumptions.
Themes: PPP and Social Infrastructure; Credit Risk Enhancement; Ports and Airports
Accessing Capital Markets for Infrastructure Finance
- Special Consideration in Global Bond Issuance
- Sales Process, Covenants, Workout Considerations
- Role of the Rating Agencies
- Mono-line Insurers and Wraps
- Tapping Local Capital Markets
- Derivative Products for PPP
PPP and Social Infrastructure
- Financing Hospitals, Schools, Prisons, Others
- Sample Concessions and Contract Terms
- Risk Evaluation and Allocation
- Monitoring Requirements
Case Example: Financing a Hospital Through Bond Issuance Special considerations of social infrastructure. Construction considerations Interface between hard and soft operating costs. Cashflow and leverage ratios.
Financing Ports and Airports
- Port Financing Compared to Airports
- Airport Checklist
Case Study: Financing an Airport Goals of government and other stakeholders from the concessionaire to the contractor, operator and other stakeholders. Review of cash flow projections, project risks and their allocation through contracts. Proposed financing mix, and rating agency considerations.
Themes: Credit and Political Risk Support; Water and Sanitation
Sources of Credit and Other Risk Support in PPP Projects
- Official Risk Enhancers and PPP
- ECAs and Development Banks
- Mono-line Insurers
Water, Sanitation and Infrastructure
Special Features of Water and Sanitation Projects Array of Funding Structures for Service Agreements and Concessions Who are the Players? Investors? Lenders?
Two Case Studies:
1) Financing a Water Treatment PlantParticipants will review the terms of a concession for a municipal wastewater treatment plant. 2) Non-revenue Water (NRW) Understanding a service contract for reducing non-revenue water. Considering the merits of the proposed financing approach.
Ms. Osius designs and delivers executive level training sessions as well as providing consulting services to a wide variety of organizations worldwide. Specializing in international project finance, capital markets, and risk management, she works with corporate investors, private and development ...
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Because of COVID-19, many providers are cancelling or postponing in-person programs or providing online participation options.
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