Shearman And Sterling

News May 16, 2017

Shearman & Sterling Represents Initial Purchasers on US$814 Million Bond Offering by ACWA Power Management and Investments One Limited

Shearman & Sterling represented the syndicate of banks led by Citigroup Global Markets Limited and Jefferies International Limited, as joint global coordinators and joint bookrunners, China Construction Bank Corporation, Singapore Branch, Mizuho International plc, NCB Capital Company and Standard Chartered Bank as joint bookrunners, and MUFG Securities EMEA plc and SMBC Nikko Capital Markets Limited as co-managers, in connection with ACWA Power Management and Investments One Limited's ("Issuer") offering of US$814 million aggregate principal amount of 5.95% senior secured bonds due 2039.

The Issuer is a DIFC-incorporated, wholly owned subsidiary of International Company for Water and Power Projects ("ACWA Power"), the largest private power generator and desalinated water producer in the Kingdom of Saudi Arabia.

The unique transaction structure allows ACWA Power to monetize its dividend cash flows from stakes held in the project companies by offering investment-grade bonds rated under the traditional project finance methodology. The bonds are secured by ACWA Power's pro rata cash flows from the eight power generation and water desalination plants in the Kingdom of Saudi Arabia and pledges over the shares of the Issuer and ACWA Power's Saudi holding company. This bond structure is believed to be the first of its kind and allows ACWA Power to issue Shari'a compliant trust certificates (Sukuk) in the future.

The offering is designed to enable ACWA Power to diversify its sources of financing, raise longer maturity capital commensurate with the maturity profile of its asset base, repay certain existing facilities and enhance its funding flexibility. The offering represents a transformational moment for ACWA Power and marks a key milestone in the evolution of corporate Saudi Arabia.

The Shearman & Sterling team below included counsel Moyn Uddin; associates Ellaine Gelman, Joseph Hutchinson, Ibrahim Bakhurji, Evelina Petraviciute, Nicolas De Clercq, Amit Kanda, Sarah Moir-Porteous and Stefanovic-Grbec; trainees Hannah Drake, Joe Ohlson, Oliver Ison, Agostino Bignardi, Frances Burchall, Gartan Tracey and Adam Quigley.

The Team