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?

• Heads of Project Finance
• Heads of Corporate Finance
• Heads of Structured Finance
• Treasurers
• Project Managers
• Accountants
• Analysts
• Sales Managers

Supported By:

Day 1 - Project Finance Workshop

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

Key issues in project finance and risk management

Introduction
 

• Activity in the project finance market
•  Factors driving the demand for project finance
•  Key lessons from the past

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

 Qualitative risk evaluation in project financing

•  Country and political risk
•  Understanding the project finance process

Case study: country & political risk - structuring a project finance deal in a developing economy.

Assessing qualitative risks in a variety of projects.

Identification and assessment of the key risks

• Feasibility studies and review of operating assumptions forselected projects, are the assumptions realistic?
•  Review of the key aspects of a summarised feasibility study

Case study: evaluate the underlying operating assumptions for assigned projects.

 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

 

Day 2 - Project Finance Workshop

Assessing the financial viability

Case study: review of assigned case studies to examine key sensitivities.

 Building and sensitising the operating cashflow

• Useful Excel sensitivity functions
• Assessing the financial sensitivity of the assigned projects to key risks
• Key factors influencing the project IRR

Sources of debt financing in projects

Financiers and their objectives 

• Country risk: the use of export credit agencies, development banks and political risk insurers
•  Use of financial instruments: bank vs. bond markets
•  Credit enhancement techniques
•  Interest, FX and commodity price exposures

Case study: debt funding for selected projects. Participants develop the debt structure for their assigned case studies and identify key influences on the debt service coverage ratios.

 

Day 3 - Project Finance Workshop

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
•  Determining an exit route, including IPOs
•  Extracting cash from the project company

Case study: structuring project finance from an equity investment perspective.

• Are returns adequate to justify the investment?
•  Key influences on equity returns.

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 - Project Finance Workshop

Contract structuring and problem projects

Case study: structuring third party credit support and security.

Refine a proposal which includes capital structure, proposed covenants, third party credit support and security.

Why projects face difficulty
 

• Lessons from the past
• Typical reasons for failure
• Options for equity investors in problem projects and practical problems

Mini case study illustrating some of the potential problems in project finance

Course summary and close

• Malcolm Sullivan

  Malcolm 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 Malcolm 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 UK based Real Estate advisory firm.

  In the area of financial training Malcolm 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. Malcolm 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.

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

Project Finance Workshop

Interested in holding this course in-house? Please fill out your details and a member of our team will be in touch with more information.

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