| 08 Nov 2009 |
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Lovells advises Lafarge on first project financing to be closed in Syria
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$US682M deal represents a landmark transaction in the Middle East
International law firm Lovells has advised a subsidiary of Lafarge S.A. on the project financing relating to a $US682 million development of a cement plant in northern Syria. This is believed to be the first project financing to have closed in the country.
The project finance loans amount to $341 million, made available in Syrian Pounds and US dollars, and have been provided by an international syndicate of lenders including EIB, Proparco, EKF and Bank Audi S.A.L. Audi Saradar GroupBank Audi S.A.L. Audi Saradar Group
. The funding was provided to one of Lafarge's subsidiaries, Lafarge Cement Syria S.A.Lafarge Cement Syria S.A., enabling the refinancing of a bridge facility and the completion of the construction phase of the project.
The groundbreaking nature of this matter meant that an innovative structure was required. A three phase structure was adopted for the financing whereby the terms will start on the basis of recourse to the sponsors, and upon the requirements for a new phase being achieved the recourse to sponsors is reduced and then removed. The criteria for moving to a new phase include a combination of construction and performance milestones and the fulfilment of various local law requirements relevant to a project financing.
The Lovells team for the transaction was led by finance partner Paul Oldman and Consultant Nick Tidnam with assistance from Associate Ajoy Bose-Mallick.
Nick Tidnam said:
"This deal represents another example of the high quality work that we are undertaking for clients in the Middle East and reflects on our position as one of the leaders in the international infrastructure projects market. Compliance with local financial and foreign exchange regulations was paramount and we achieved this in the finance structure without compromising the requirements of the sponsors - ensuring an efficient use of capital as well as sponsor support in the initial phases. Overall the deal represents great news for sponsors and banks contemplating project financings in politically risky markets given the recent market conditions imposed by the global credit crisis".
Lovells worked alongside Syrian law firm, Sayed & Sayed and an in-house legal team at Lafarge comprising Mr Abdur Rahim, one of its Senior Legal Counsel in the Middle East based in its Cairo office, and Gilles Vanlerberghe, Legal Counsel to the Corporate & Securities Group at Lafarge in Paris.
The Lenders were advised by a team from Shearman & Sterling in London led by Kenneth MacRitchie and by Hakim Law Firm in Damascus. Bank Audi was additionally advised by Wadhi Cortbaoui at Ramzi Joreige & Partners in Damascus.
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About Lovells
With over 3,000 people operating from 28 offices in Asia, Europe and the United States, Lovells is one of the world's leading international law firms. We advise many of the world's largest corporations, financial institutions and governmental organisations. We regularly act on complex, multi jurisdictional transactions as well as some of the most high profile commercial disputes. Lovells (the "firm") is an international legal practice comprising Lovells LLP and its affiliated businesses. Lovells LLP is a limited liability partnership registered in England and Wales with registered number OC323639. Registered office and principal place of business: Atlantic House, Holborn Viaduct, London EC1A 2FG.
www.lovells.com
For further information and/or visuals, please contact:
Nick Tidnam, Of Counsel
+44 (0) 20 7296 5660
nick.tidnam@lovells.com
Fred Banning. PR Adviser
+44 (0) 20 7296 2860
fred.banning@lovells.com
© Press Release 2009
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