Mainstream nears close on IDB deal for renewables portfolio
Mainstream is in talks with the Inter-American Development Bank (IDB) for a $150 million loan to finance part of the 730MW solar and wind scheme in Huemul and Copihue in Chile. Financial close is due in Q1, however the involvement of the IDB is now expected to slowdown the deal gestation according to deal-makers.
The projects - comprising four wind projects with a total capacity of 525MW and two solar plants totalling 205MW - mark the second and third stages of the sponsor's 1.3MW Andres Renovables portfolio, and are backed by a 20-year US dollar-denominated PPAs with Chile's National Energy Commission, awarded during the 2016 auction. Commercial operation is scheduled for 2021 and 2022.
Mainstream sounded out banks for $500-$600 million in December 2019, shortly after reaching financial close on its Condor project financing on 4 December. However, the sponsor has decided to go down the DFI route this time round rather than mirroring the structure of Condor, which was financed with six banks via a $580 million 19-year loan priced at 230bp over Libor, with step-ups beginning in year six.
Mainstream has not decided whether it will finance all the projects together under the Huemul phase or whether it will leave a smaller amount to finance in the third and final Copihue phase. But one thing is for sure, the IDB's participation will give the sponsor more leverage with the banks, although banks that do not agree to the terms could be dropped from the financing.
