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Financing Strategies

Financing Strategies. Mark Dagel President and Co-Chairman Link Global Holdings, LLC. Alternate Capital Source: Project Finance. Many companies are looking for secure financing options that can maximize returns & not tie-up liquidity.

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Financing Strategies

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  1. Financing Strategies Mark Dagel President and Co-Chairman Link Global Holdings, LLC

  2. Alternate Capital Source: Project Finance • Many companies are looking for secure financing options that can maximize returns & not tie-up liquidity. • Project Finance can provide an alternate capital source for both public and private companies looking for construction financing. • Debt provided for project development solely based on the project’s perceived risks & expected cash flows • Debt providers have either no recourse or limited recourse to the parent company that develops or “sponsors” a project

  3. Alternate Capital Source: Project Finance

  4. Bonds And Project Finance • Along with equity, traditional sources of capital for project finance include bank loans & personal investment. • Market problems have led developers to seek new sources of capital for project finance. • Bonds can either be a sole source of debt, or a complement to bank debt and offer structured advantages such as longer tenor, lower interest rate, and flexible amortization schedules that improve equity returns.

  5. Bond Credit Enhancement Mechanisms • Currently, many projects reviewed by the rating agencies find themselves well below the investment grade threshold due to factors such as technology risk, scale-up risk, or feedstock risk. • There are several credit enhancement mechanisms that can be employed to help mitigate these risks and allow the bonds to be priced at a more reasonable interest rate level. • Third Party Insurance • Highly tailored technology warranties that are able to support a bond funded project financing. These third party insurers have both the technical expertise & balance sheet savvy to offer investment grade offerings. consider investment grade have begun offerings. • State and Local Governments Credit Enhancement • Government support can range from accelerated permitting to financial backing in the form of guaranteeing the debt through a “Moral Obligation”

  6. Bank vs bond market

  7. Bond Credit Enhancement Mechanisms(cont’d) • Export Finance Agency Loan Guarantees • Most OECD member countries have an export finance agency whose goal is to support the export sales of goods and services from their country • The majority have project finance programs that can guarantee loans. Many have a policy of supporting alterative energy and sustainability • The amount of the loan guarantee from an export finance agency is based on percentage of domestic content (either goods or services) to be exported to a foreign buyer • A loan guarantee becomes a 100% unconditional repayment obligation of the export finance agency whose credit rating is equivalent to its national governments credit rating • Export finance agency financing require goods and services to move across borders

  8. World Bankanother source of Project Capital & Credit Enhancement

  9. Link Global Holdings Activities Chart

  10. Link Global Holdings, LLC Activities

  11. Contact Page

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