Yes. All project finance lenders, project finance arrangers and project finance providers require the borrower to have equity in the deal. Project finance is not speculation. It was developed more than 700 years ago as a method of financing that is specifically intended to mitigate or eliminate risk. In fact, almost every element and procedure in project finance are for risk mitigation.

Yes. Although it is exceedingly rare, we will look at sourcing funds for refinancing of existing projects under the right circumstances.

Yes. While the vast majority of project financings sourcing provide traditional development, utility, infrastructure and public private partnership projects, we are willing to source funds for acquisitions of projects which are already operating.

No. We do not source financing for projects that are limited to the purchase of land. This is not project finance, it is speculation.

Project financing is never provided for projects with construction that has already commenced because there is simply no easy or foolproof way to secure the collateral.

Project finance is complex financing that requires a great deal of time, expertise and expense, so our project sourcing funding minimum is US$10,000,000.

At the moment Africa is Our Business & the business is Africa that is our assignment area of focus. The African countries that qualify must be democratically governed.

Political and economic stability of the country in which the project is to be based, likely return on investment, market saturation, geographical location, site accessibility and many other factors.

Yes, we can help. You are right to be concerned. International project lenders are risk-averse and will not invest in projects that don’t have sponsors with strong operational and managerial experience. We can provide management personnel with strong industry experience and can incorporate them into the project documents if we are preparing them. This will strengthen investor and lender confidence in the project because their investment will be protected by experienced and proven managers. The provision of project personnel is subject to contract.

Yes, project documents should always include a material disclosure statement affirming that you have not furnished the data for the market feasibility study or the financial feasibility study. Affirmations such as these give potential investors confidence in the financial data used in the core project studies, and in the independence and objectivity of the studies.

The financial feasibility study is absolutely critical to the approval of project finance loans. For financial feasibility studies to be credible they must be based on data derived from the real-world cash flow performance of comparable existing projects, not unsupported assumptions. Financial feasibility studies which are based on unsupported assumptions rather than factual data from comparable projects carry no weight with project lenders or international investors. To qualify for project financing and secure project loan approval, we must present your project to lenders based on realistic revenue, expense, profit and cash flow projections and must be able to demonstrate an acceptable internal rate of return.

We only accept project financing engagements with high-quality, well-written documentation. International investors and lenders rarely approve projects with poorly written, inaccurate, incomplete or unsupported documentation. It is not possible to raise international project finance with inadequate documentation and therefore we only approve projects supported by international investment standard documentation.

Probably not, unless your accountant has a great deal of experience securing international project financing. Project documentation must be of sufficient quality to convince the world’s most sophisticated investors to finance your project and we know of no way of doing that without high-quality, well-written project documents.

High quality, well-written project finance documents are essential for getting your project finance loan approved. The more professional the project finance documents, the higher the likelihood of being able to negotiate loan terms which are favorable to the project, its sponsors and stakeholders.

After the project financing is closed and the project commences, the project documents are also vitally important for the success of your project.

There are far more projects seeking financing worldwide than there is available funding. Therefore, potential lenders must be convinced that your project is not only a solid investment but that it is a better investment than the other project finance requests being considered. Your project finance documents are the primary means of communicating this.

If the lenders do not appoint us as loan supervisors we may join the lending syndicate.

We perform enhanced due diligence on all project stakeholders with an emphasis on project sponsors. The due diligence investigations are mandatory and project finance underwriting cannot be completed until all of the due diligence has been implemented. We have a form for project sponsors which is furnished at the start of underwriting. Due diligence investigations are performed by a third party service with whom we have an agreement for discounted investigative fees and you are only responsible for the actual fee.

Before we submit a project finance loan request or documents to our financial partners, we perform a preliminary due diligence investigation. While not the final, comprehensive due diligence that will be required if the deal continues forward, the preliminary due diligence investigation is intended to uncover any sponsor or project deficiencies that would hinder the closing of the project financing.

We will verify the Sponsor’s reputation, financial strength, and relevant experience. We will verify the quality and sufficiency of the project documents (at least those that have been prepared to date), and we will analyze the project and property in tandem with our site visit. Our Preliminary Due Diligence Report will be prepared after the site visit and provided to the lenders.

Before we submit a project finance loan request or document package to one of our financial partners, we perform a preliminary due diligence investigation. It’s not the comprehensive due diligence that will be required if the deal continues forward, the preliminary due diligence investigation is intended to uncover any sponsor or project deficiencies that would hinder the closing of the project financing.

We will verify the sponsor’s reputation, financial strength, and relevant experience. We will verify the quality and sufficiency of the project documents (at least those that have been prepared to date), and we will analyze the project and property at about the same time as our site visit. Our Preliminary Due Diligence Report will be completed after the site visit and provided to the lenders with the loan application and project finance documents.

We break project finance due diligence into two distinct packages. The preliminary due diligence investigation is performed more or less coincidentally with the site visit. The final, comprehensive due diligence is performed after you get preliminary approval.

The borrower pays for both investigations, the site visit costs for two of our senior managing partners, and all expenses.

A common error made by project sponsors who have never developed a significant project before is they attempt to package the project for financing with project documentation developed by consultants with whom they are comfortable, rather than established consultants with international reputations.

It is natural to want the documentation to appear as favorable as possible but is much more important to develop documentation that is realistic and upon which international lenders and investors can rely.

No. Lenders would not regard us as being independent from you if we entered a joint venture with you.

No. Lenders would not regard us as being independent of you if we took a stake in your project.

No. Lenders would not regard us as being independent of you if we received finance provision fees from you before finance is placed with your project.

We receive our finance provision fee success fee from you only when finance is actually placed with your project.

To have the necessary confidence to invest, lenders must have complete confidence that we are presenting them with a fair, accurate, objective and independent evaluation of your project.

Neither. We maintain very strict independence from you and from the lenders during the project financing process.

The time required to finance a project varies greatly from project to project and is primarily determined by the project’s scale, complexity, nature, marketability, the prevailing economic conditions and the readiness of the project to go to market.

The likelihood of a project being financed depends on project viability, projected profitability, the quality of the project documentation, prevailing economic conditions and other factors.

No. Every project has an element of risk.

The lenders require us to independently analyze and where appropriate approve your project documentation.

After the syndicate is formed we typically offer you a number of loan proposals.

The syndicate is formed after your project documentation has been completed, verified and approved by us.

The syndicate is typically composed of a variety of investors including hedge funds, institutional investors, government investors, private investors, investment banks, investor groups, money market funds, mutual funds, pension funds and venture capital firms selected from our private database of professional investors and lenders. We have associates who are retained by national banks and financial institutions as project advisors.

We form a syndicate comprising a number of professional international investors and lenders. From the investors’ viewpoint, the advantage of being a member of a syndicate rather than the sole investor is that it spreads the risk for the project and each investor can see that other investors have independently concluded that the project is viable and profitable.

Yes, SPH can create the project finance documentation for your project. Having us develop the project documents significantly increases the likelihood of securing approval for the project financing because we can control the quality of the documents and we can craft the documents precisely the way lenders prefer them. Our high-performance project finance team that produces comprehensive market studies, financial feasibility studies, business plans, architectural plans, environmental surveys and all of the project documentation you need. We develop the project documentation for most of the projects we approve for financing.

The deal always proceeds. During document preparation, we begin our due diligence procedure and underwrite the project financing.

The cost of developing project documentation varies widely depending on the scale, nature, and complexity of the project. It is a significant expense but is necessary to secure financing and likely improves the profitability of the project.