A joint venture of BAM PPP and PGGM is understood to have raised GBP 246.5m of debt to refinance facilities linked to two PPPs in Ireland, as sponsors continue to take advantage of lower margins in the sector.
The construction company and the Dutch pension fund, which founded the joint venture in 2011, reached financial close on the refinancing of the Irish Schools Bundle 3 and the N11 Arklow/Rathnew PPP road earlier this month, sources said.
The European Investment Bank and the Bank of Ireland provided debt priced at around 4% when the two projects reached financial close in 2012 and 2013. In the refinancing, both EIB and BoI have remained as lenders on the projects but on lower margins, it is understood.
BoI debt funded the Irish Schools Bundle 3 with a senior tranche of EUR 56.5m, while the EIB provided EUR 50m.
For the N11 road PPP, which connected two existing bypasses on the M11 creating a 90km stretch between Dublin and Gorey, the EIB and BoI each provided EUR 70m.
BAM PPP PGGM owns stakes in seven Irish PPPs, including the Irish Town Seven Courts Bundle PPP, the M11 Gorey to Enniscorthy PPP and the N25 New Ross Bypass.
There has been a recent uptick in refinancings in Ireland due to banks’ ongoing willingness to offer lower margins. A slowdown in greenfield procurement also means lenders are more willing to take part in refinancings.
Sponsors are also in the process of refinancing debt linked to the Dublin Convention Centre and the M4 PPP. Rubicon Infrastructure Advisors served as an Advisor to BAM PPP and PGGM.
This piece was published on February 28, 2019.