World leader in nuclear power Areva has just finalised a limited recourse financing for SET (Société d'Enrichissement du Tricastin), which owns and runs the Georges Besse 2 uranium enrichment plant in Tricastin, southwest France, the first centrifuge-base enrichment plant in France. A loan of EUR650 million with a 10 year tenor has been granted with support from a group of 10 international banks (Banco Bilbao Vizcaya Argentaria (BBVA), Bank of Tokyo-Mitsubishi (BTMU), BNP Paribas, Crédit Agricole Corporate & Investment Bank, Crédit Industriel et Commercial (CIC), HSBC, HVB-Unicredit, Natixis, Santander and Société Générale).

Backed by long-term revenues from the Georges Besse 2 plant, the transaction is the first limited recourse financing of a nuclear project in France, and in the world, and is the first limited recourse financing of any AREVA nuclear asset.  The ramp-up of the plant, whose construction began in 2006, continues in line with the original schedule, with an installed capacity of 84% as of the end of May 2014. When running to full capacity, the plant will produce enough enriched uranium to supply 70 reactors with nuclear fuel.

This new structure enables Areva to benefit from favourable financing conditions while retaining access to the cash generated by plant activity. It makes it possible for Areva to diversify its sources of finance without any impact on the average duration of its debt. The structure of this innovative, tailor-made loan combines project finance techniques with standard corporate finance approaches.

The lenders were advised by Herbert Smith Freehills Paris with a team led by Eric Fiszelson (partner, banking and finance), assisted by Jihene Choyakh, Audrey Lesage and Romain Guirault on the financing aspects, Christophe Lefort (partner, energy and infrastructure), Mathias Dantin, Raphaelle Buot de l'Epine and Thomas Hermann on the legal due diligence, and Edouard Thomas (partner, corporate) and Elise Favier on the corporate aspects.

Areva was advised by Allen & Overy Paris. The team was led from Paris by partner Adrian Mellor (banking and finance partner), supported by senior associate Tom Longmuir and associate Tristan Jambu-Merlin.  Partner Shaun Beaton advised on construction aspects of the financing, assisted by associate Robert Bodnar.