Hydro ABS Approaches Pricing

The Reventazon hydroelectric project sponsored by Costa Rica’s Instituto Costarricense de Electricidad (ICE) has opened bids from investors for a planned $415m cross-border corporate securitization of a project loan, according to people familiar with the plans. The 20-year senior secured RegD/RegS notes, issued by the Reventazon Finance Trust (RFT) entity, are backed by a 100% participation interest in a 20-year B-loan from the Inter-American Development Bank (IDB), according to ratings reports. Allocation of bids was expected to take place during the early part of this week, with settlement to take up to a month. The B-loan is part of the secured debt which finances the design, construction, future operation and maintenance of the 305.5 megawatt Reventazon hydroelectric power plant in Costa Rica. The project has been structured so that construction, operation, and other risks are covered by ICE. The notes begin amortizing in 2017, and benefit from a debt service reserve account equivalent to the next principal and interest payment due amount. BNP Paribas is managing the transaction, rated BBB minus/Baa3 and which was aiming to complete pricing this month. The total project cost is $1.4bn, according to the IDB, with funding also coming from a $475m equity contribution from ICE, a $200m IDB A-loan, $100m IFC loan and $218m in domestic bank debt, according to Moody’s. Reventazon is expected operational in 2016.