Shearman & Sterling advised Japan Bank for International Cooperation (JBIC) as lender in connection with its CAD 450 million project financing for the Ontario Line subway project in Toronto, Canada. The loan is co-financed with Sumitomo Mitsui Banking Corporation and the Norinchukin Bank, bringing the total co-financing amount to CAD 1,100 million. The transaction marks JBIC’s first project finance loan in the transportation sector in North America and forms part of Plenary Americas’ Connect 6ix consortium CAD 9 billion financing for the Ontario Line Rolling Stock Systems, Operations and Maintenance (RSSOM) contract.
The project involves Connect 6ix General Partnership (Connect 6ix) constructing a 15.6 kilometre subway line in Toronto, operating and maintaining the subway line for 30 years following completion, as well as supplying the trains and railway systems. The construction of the project is scheduled to begin in early 2023 and be completed in 2031. The Ontario Line is a priority transit project for the Government of Ontario and is expected to contribute to environmental preservation through reducing traffic by 28,000 vehicles per day and lowering fuel consumption by 7.2 million liters per year.
The loan provided by JBIC was made under its GREEN (Global action for Reconciling Economic growth and Environmental preservation) initiative, which supports projects that are aimed at preserving the global environment, such as reducing greenhouse gas emissions. It is also in line with the Government of Japan’s Infrastructure System Overseas Promotion Strategy 2025 which aims for Japanese companies and technology to play a key role in quality infrastructure projects that have high environmental performance.