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Project Finance Workshop
£4,295.00

By the end of this 4 day Project Finance training course you will understand the crucial factors and techniques used in structuring project financings.

Course Instructors:

  •  Over 35 years expereince in the financial services industry and co-author of “Financial Products: A Survival Guide”
  • Guest speaker (Introductory session, day 1): The guest speaker has a broad commercial and investment banking background spanning over 35 years and was a member of Chase's European Management Group.


This Euromoney Project Finance training course will provide you with an intensive overview of the core principles and practice of project finance. You will gain a greater appreciation of 'project pitfalls' as well as grasp a thorough understanding of the crucial factors and techniques used in structuring project financings.

How will this project finance training course assist you?

This 4-day Project Finance training course will provide you with the skills and knowledge to:

  • Better structure your project finance deals
  • Comprehend the uses and abuses of financial modelling i.e forecasts vs. reality
  • Understand essential credit issues in assessing project finance proposals
  • Get to grips with funding choices and capital structuring issues
  • Gain the perspective of the equity investor
  • Understand risk allocation and mitigation
  • Understand corporate distress and implications for project finance

Who should attend?

Using a core case study and other examples of the use of Project Finance this hands on workshop is designed for personnel involved in project procurement, development and construction, investment, financial and technical appraisal and financial structuring and ongoing project management for large scale projects working for;

  • Project developers and investors
  • Construction companies
  • Government and other Public Sector Agencies
  • Equipment suppliers
  • Commercial Banks
  • Investment banks
  • Development Finance Institutions
  • Export Credit Agencies
  • Infrastructure Funds
  • Accountancy firms
  • Law firms
  • Financial advisors and consultancy firms
  • Infrastructure specialists


Participant existing pre-requisites

Although limited practical Project Finance experience has been assumed, to obtain maximum benefit from this training programme participants should already be familiar with the core aspects of:-

  • Corporate financial analysis techniques
  • The main functions in Excel
  • The principal banking and Capital Markets debt products
  • Investment appraisal techniques ( e.g. IRR, NPV) and the fundamental principles of company valuation
  • Banking documentation


Supported By:

 

Day 1


Registration commences at 8:30
Programme runs from 9:00 - 5:00 daily

Key issues in project finance and risk management risk analysis and underlying business assumptions

Lessons of experience - an overview of crucial issues in Project Finance

  • Commercial motivations for Project Finance
  • Project Finance vs. the financing of projects
  • The critical issue in all project financings
  • Risk and return
  • Factors influencing financing techniques and the syndication process

The evolution of Project Finance – how the market has developed

  • Activity in the Project Finance market
  • Factors driving the demand for Project Finance
  • Understanding the roles and motivations of the key stakeholders in a project

 An overview of key issues in project finance

  • Review of a Project Finance transaction to illustrate key aspects of the transaction and subsequent developments
  • The Project Finance “route map” - an overview of the key issues in evaluating and structuring a Project Finance transaction

Risk evaluation in Project Finance

  • Key risks – construction, operating and financial
  • Typical approaches to risk allocation
  • Overview of the approach to a credit analysis for power projects to illustrate key elements of a rating
  • Exercise: participants review background on the core case study project and prepare a summarised “risk rating” based on the risks and mitigants in the project

Evaluating the business plan and the underlying assumptions

Feasibility studies and lessons of experience - are the assumptions realistic?

Case study: participants evaluate the underlying operating assumptions for an assigned project. 

 

Day 2

Evaluating the project financial viability, debt capacity and sources of debt finance

An overview of the project financial statements

  • Review of a generic Project Finance spreadsheet to understand the main influences on the project’s viability
  • The impact of capital and operating costs on project viability
  • Using nominal vs. inflation adjusted figures 
  •  Use of sensitivities and Monte Carlo simulations
  • The relationship between leverage, return, DSCR and project viability

Building and sensitising the operating cashflow

  • Useful Excel sensitivity functions
  • Assessing the financial sensitivity of the core case study project to key risks
  • Key factors influencing the project IRR
  • Case study: review of the core case study project to examine key sensitivities.

Sources of debt financing in projects and debt capacity

  • Rationale for Project Finance vs. other debt financing techniques
  • Debt capacity - Using projected cash flows as a basis for assessing debt servicing capacity
  • Export Credit Agencies and Development Banks; bank debt vs. bonds; senior vs. subordinated debt
  • Use of Islamic Finance techniques
  • Interest, foreign exchange and commodity price management issues in Project Finance 
  •  Review of selected Project Finance transactions – risk and return in structuring Project Finance transactions
  • Impact of the credit crisis
  • Case study: review of the core case study project to assess the debt servicing capacity and key sensitivities.


Day 3 


The equity investor’s perspective, commercial aspects of documentation

 
 Financial yardsticks used by investors: uses and limitations
 

  • Project investment appraisal techniques
  • Corporate cost of capital as a basis for evaluating project returns
  • How equity investors seek to mitigate risk in project finance
  • The trade-off between leveraging equity returns and the need to provide credit support
  • Assessing the impact of operating relationships between the project sponsors and the project company on equity returns
  • Subordinated debt vs. equity and factors influencing the choice
  • Extracting cash from the project company

Exercise: evaluating comparative returns from potential projects

Case study: bidding for a concession

Case study: review of the core case study project to develop a capital structure that balances the need of debt and equity providers

Commercial issues in project finance documentation
 

  • Structure of loan documentation
  • Key covenants and potential complications
  • Concession agreements
  • Structuring off-take agreements
  • Dealing with market risk
  • Choice of construction contract
  • Completion and cost overrun guarantees
  • Shareholder lock-ins
  • Banking security
  • Intercreditor issues
     

Day 4


Contract structuring and problem projects

Case study: structuring third party credit support and security. Participants refine a proposal for the core case study project to cover the capital structure, pricing, proposed covenants, third party credit support and security.

Why projects face difficulty

  • Lessons from the past – review of a project that has faced financial difficulty
  • Typical reasons for failure
  • Options for equity investors in problem projects and practical problems

Course summary and close

  • The course instructor has a career in the financial services industry and financial training of over 35 years. In the banking and consultancy areas, Malcolm started his career with National Westminster Bank, moving to Mellon Bank NA (now part of Bank of New York Mellon). At Mellon Bank, Malcolm held several credit analysis and account management positions in London, focusing on large corporates. He also had two extended work assignments in the USA.

    At Swiss Bank Corporation (now part of UBS) in London he was actively involved in the development and ongoing management of the bank's UK Commercial Real Estate lending activities. His Real Estate related skills were further developed at Debenham Tewson Financial, a subsidiary of a leading global Real Estate advisory firm.

    In the area of financial training the instructor has designed and delivered tailored courses for clients in more than 50 countries concentrating on the areas of Project and Infrastructure Finance, Corporate and Credit Analysis, Real Estate finance, and Asset Securitisation. He is also the Course Director for the Euromoney Project Finance Workshop which has been running for over 15 years in London and New York.

    Participants on Project and Infrastructure Finance related courses run by Malcolm range from recent graduates to experienced line managers in a number of job functions. Participants attending Infrastructure / Project Finance course that Malcolm has trained cover a range of organisations involved in Infrastructure Finance including Government and Government Agencies, project sponsors, contractors, financial institutions including Multilaterals and Export Credit Agencies, as well as consulting and advisory firms.

    He is the co-author of “Financial Products: A Survival Guide” published by Euromoney Publications in 1996.

  • Guest speaker (Introductory session, day 1): The guest speaker has a broad commercial and investment banking background spanning over 35 years having been with Chase, where he was a member of the Bank’s European Management Group, for 19 years before joining ABN Amro where he was head of the Special Industries Group at the head office in Amsterdam. He was appointed head of Project Finance at Chase, taking responsibility for the Banks activities outside of the US, shortly after joining the investment bank in 1985. Among his many achievements was his pivotal role in the development of the build own transfer (“BOT”) model in Turkey as well as leading the privatisation of the Oman electricity sector. He established Glen House Capital Strategies in 2002 and has continued to provide advisory services to governments and corporates in all aspects of project and corporate finance.

    Central London Hotel Venue, London, UK

    All Euromoney Financial Training courses are held at four or five star venues in Central London, Zone 1. We strive to provide you with a training environment of the highest quality, to ensure that the whole learning experience exceeds your expectations.

    Your training venue will be confirmed by one of our course administrators approximately 3-4 weeks before the course start date.