Peru Power Plant Completes Project Bond

Planta de Reserva Fria de Generacion de Eten, has raised $132.8m through a novel project bond, according to people familiar with the transaction. The Peru-based power generation company’s 20-year partially guaranteed bond priced at par with a 7.65% coupon and closed this week. The senior secured notes come with a 20% credit guarantee from development bank CAF. Proceeds will be used to finance a 20-year concession to build and operate the 223 megawatt Eten simple-cycle natural-gas fired power plant in Peru’s Chiclayo province. BTG Pactual was sole lead on the RegS-only transaction, rated BBB minus/BBB minus. The project will provide a reserve electricity source to Peru’s National Interconnected Electricity Framework (SEIN) for periods of increased demand or shortage of supply. It will also provide energy in circumstances where it is more efficient for the SEIN to receive energy on a reserve, standby basis. The project is sponsored by Cobra Peru, a unit of Spain’s ACS, and EMCE. The transaction represents LatAm’s first international greenfield project bond, first power plant project bond and first international project bond with a partial credit guarantee, according to DLA Piper, counsel to BTG Pactual.