New details on IDB's $1bn loan to Chilean power companies
New details have emerged surrounding the size and beneficiaries of IDB Invest’s credit line for Chilean power companies which were impacted by last year's power price freeze in the South American country. The freeze is set to last until December 2020, with payments deferred for two years.
The $1.08 billion loan, as disclosed by the DFI, will be used to securitize receivables from the PPA.
The beneficiaries are a mix of owners of thermal, hydro, solar and wind assets in Chile. They include Aela Generacion, AES Corp subsidiaries AES Gener and Guacolda Energia, EIG Global Energy Partners through its special purpose vehicle Cerro Dominador, Colbun, Latin America Power, Atlas Renewable Energy, Enel Generacion Chile, Engie Energia Chile, Andes Mining and Energy Corp (AME), and Generadora Metropolitana – a joint venture between AME and France's EDF.
IDB is currently conducting their due diligence on this loan, which remains subject to board approval and expected to be reviewed by the end of August. This credit line was originally announced in April of 2020, when IDB announced they would be extending $30 million to $500 million loans to power generation companies. Despite this promising start, one deal watcher in New York remains skeptical, claiming: "We have yet to see if the firms will want to sell their receivables to the IDB". They also added that they have the option of financing it themselves.
Commercial banks BNP Paribas and Santander are working with IDB on the deal, with Clifford Chance and Guerrero Olivos acting as their legal counsel.
