Farac Sponsors Seek Mega-Loan Takeout

Goldman Sachs Infrastructure Partners – part of an equity consortium operating the first of Mexico’s Farac toll road concessions – is looking to takeout a $3.5bn MXP-denominated loan related to the project, say bankers close to the process. Proposals for a full or partial are heard due by the end of July, and likely to cover a range of financing solutions. A securitization of toll road revenues is among the most likely structures, for which the target buyer base would be Mexico’s Afores and other local investors, say DCM executives involved. “This deal is so big that any refinancing will have to rely on investors outside Mexico as well,” adds a local debt markets banker. The Farac facility is the largest local currency loan to date in LatAm and has been syndicated to a group of banks, some of which continue to seek buyers for their holdings in the secondary market. The 7-year mini-perm carries a cash sweep; meaning any and all revenues from the concession go toward interest payment. That reduces the amount of dividends equity investors Goldman and ICA, the Mexican infrastructure shop, can reap from their investment, according to a bank market executive. Goldman was not available for comment.