An overall view of the concepts and approach used in structuring and arranging project finance transactions for major infrastructure schemes in the UK and overseas.
Who should attend?
This course will be of benefit to those working within or intending to move into, project development or project finance areas. Participants include engineers, bankers, accountants, lawyers, and middle/senior managers in utility companies, commercial organizations, non-commercial organizations, Government officials, commercial banks, consulting firms, and law firms.
By attending this training you will gain:
- An overview of the concepts and approach used in structuring and arranging project finance transactions for projects
- An understanding of risk analysis and risk management techniques
- A project appraisal methodology
- An understanding of the language and approach of financiers
- Insight into the drivers, approaches, and concerns of the key players involved in creating and financing major projects
- A focus on finance and the tools to value a project
- Lectures 69
- Quizzes 0
- Duration 12hours
- Skill level No prior knowledge of project finance or finance is assumed.
- Language English
- Students 1
- Assessments Yes
Introduction and overview of project finance
- Definition of project finance
- Project finance as opposed to other sources of finance
- Limited-recourse and non-recourse finance
- Main features of project finance
- Parties involved – interests and roles
- Importance of cash flow
- Documentation – what are the aims?
- Project development process
- Why choose project finance
- Project finance market
- Project finance practical application example
The main parties in a project finance
Risks and mitigation
Credit analysis by the lenders
- How lenders assess projects
- Assessing credit worthiness
- Getting started with credit
- Business/commercial risk
- Risk evaluation framework – developing a methodology
- Macro – country – political
- Industry products / market suppliers / contracted purchases
- Project production facilities/infrastructure / technical/contractors
- Management – project’s sponsors
- Ratios ratings
- Advanced cash flow analysis
- Net operating cash flow
- Free cash flow
- Discounted cash flow
Structuring a project finance
- Repayment profiles and coverage ratios
- Key project finance ratios: sponsors’ perspective
- Investors – gearing benefits
- IRR –the internal rate of return
- NPV –the net present value
- Key project finance ratios: lenders’ perspective
- CADS–cash flow available for debt service
- DSCR– debt service cover ratios
- PLCR – LLCR – project and loan life cover ratios
- Why are the financial models used?
- What is the project and why should it take place?
- What are the key operating assumptions?
- The financial modelling assumptions: construction cost, operation: revenues, expenses, taxes, financing: debt / equity
- Cash flow : CADS – DSCR / NPV – IRR
- The projection cases
- The projection cases