Year: 2021

Winner: Puerto de Hierro

Colombia’s Puerta de Hierro toll road notched a number of firsts in Latin America and at home during the pandemic.

In the midst of the pandemic, the project secured the first social project bond in Latin America and was the first bond guaranteed by the U.S. International Development Finance Corporation (DFC) in the region. In Colombia, it was the first refinancing of a toll road as part of the country’s 4G infrastructure program. On top of this, the deal with carried out in Colombian pesos.

The importance, complexity and conditions of the bond earned Montes de María, a wholly owned subsidiary of Sacyr Concesiones, the Local Currency Financing of the Year award.

“Puerta de Hierro is a landmark transaction, not only because of the innovative structure behind the note, but also for what it meant for Colombia’s infrastructure sector,” says Javier León, vice president of Infrastructure Debt Advisory at Santander Corporate Investment Banking. “Despite economic impact from Covid-19 pandemic in the country, the transaction proved that appetite and liquidity in the market remains for this type of assets.”

The 760 billion peso ($208 million) deal involved URV-linked notes maturing in 2045 with a yield of 4.1%, which was above the sovereign. One of the unique issues with the bond was the structuring DFC dollar-denominated guarantee in local currency. The bond received a Aa1 rating from Moody’s and AA from S&P.

“The structure generated interest among investors, both local and international, and the pricing achieved was really attractive for a project of these characteristics, considering the market environment at the time of issuance,” says León.

The 198-kilometer Puerta de Hierro-Cruz del Viso Highway is central to improving connectivity in Colombia’s Caribbean region. It links three department, Atlántico, Bolívar and Sucre, providing access to seaports and airports.

The highway is located in an area of Colombia that suffered immensely during the country’s long years of violence. The connectivity provided by the highway was enhanced by more than 500 socio-environmental activities, with more than 6,000 participants, that included production projects and workshops.

It is part of the broader 4G program that includes more than 5,000 kilometers of road. The programs total cost is roughly $13 billion. 

“The structure generated interest among investors, both local and international, and the pricing achieved was really attractive for a project of these characteristics, considering the market environment at the time of issuance” Javier León, Santander Corporate & Investment Banking

SPONSOR:

Sacyr Concesiones Colombia S.A.

BANKS:

Joint Bookrunners: BTG Pactual, Banco Santander

Guarantor: USDFC

LAW FIRMS:

Paul Hastings, Posse Herrera Ruiz, Latham & Watkins, Philippi Prietocarrizosa, Milbank, Brigard & Urutia

All supporting financial institutions and law firms were transmitted to LatinFinance by the award category winners. For updates please email awards@latinfinance.com