Linklaters advises Natixis on the first European Project Bond in the telecoms sector and the first use of EIB’s PBCE instrument in France
Linklaters has successfully advised Natixis as arranger and lead underwriter in connection with the structuring, issuance and placement of the first European Project Bond in the telecoms sector. The €189 million amortising bonds are to be rated Baa2 by Moody’s and listed on Euronext Paris.
This is also the first time the European Investment Bank’s PBCE (Project Bond Credit Enhancement) instrument has been used in France to back a Project Bond, having previously been used in the energy and transport infrastructure sectors in Spain, the UK and Belgium.
The bond issue adopts an “Issuer-Borrower loan” approach.
The bonds will be issued by a French securitisation vehicle (Fonds commun de titrisation or “FCT”) , the FCT France Broadband Infrastructures, created jointly by Eurotitrisation as managing company and Natixis as custodian.
The proceeds of the issue are to be applied to fund the purchase by the FCT of receivables arising under a term loan facility granted by Natixis to Axione Infrastructures S.A.S., a subsidiary of FIDEPPP, Caisse des dépôts et consignations, Axione and Bouygues Energies & Services (Group Bouygues Construction) as borrower.
The facility is used to refinance in full an existing term loan facility made available by commercial banks to Axione Infrastructures in 2009 to finance the design, roll-out, operation, maintainance and provision of wholesale broadband network services to internet service providers (ISPs) in rural France under the Public Initiative Networks (PIN) framework through 12 subsidiaries of Axione Infrastructures which hold 11 long-term concession agreements with French local authorities. The transaction also contemplates the issuance of additional unlisted PBCE-backed project bonds of one or more classes, the proceeds of which will be used to fund the purchase by the FCT of receivables arising under an uncommitted capex facility that may be made available by Natixis to Axione Infrastructures to fund certain capital expenditures incurred by it and its subsidiaries.
Linklaters advised Natixis on all aspects of this complex transaction (including the new loan to Axione Infrastructures, uncommitted capex facility, creation of the FCT, assignment of the loan receivables to the French FCT, bond issuance, refinancing of the existing facility, listing and rating of the bonds) which required close cooperation between the project finance, capital markets and public law teams.
During a press conference held on 23 July 2014, Neelie Kroes (European Commissioner for the Digital Agenda and Vice-President of the Commission) highlighted the innovative and inspiring nature of this project. In addition, Michel Sapin (Finance Minister), Arnaud Montebourg (Minister of the Economy, Industry and Digital technologies) and Axelle Lemaire (Secretary of State for Digital technologies) confirmed in a joint press release, that this first project bond to be signed in Europe in the telecommunications sector is a demonstration, especially to institutional private investors, of France’s “commitment to the modernisation of its digital infrastructures and the full mobilisation of key players in the Plan France Très Haut Débit (France’s superfast broadband scheme) ”.
The Linklaters team was made up of:
* Project Finance partners Bertrand Andriani and François April, assisted by associates Darko Adamovic, Vivien Bon, Ghita Bennis and Aurélie Chavinier;
* Public Law/Public Affairs partner Paul Lignières, assisted by associates Pierre Guillot and Marianna Frison-Roche;
* Capital Markets partner Patrice Doat, assisted by associates Agathe Motte and Guillaume Malaty.
Clifford Chance advised Axione Infrastructures and its shareholders, FIDEPPP, Caisse des dépôts et consignations, Axione and Bouygues Energies & Services (Groupe Bouygues Construction).
The Clifford Chance team included Daniel Zerbib (Partner), Benjamin de Blegiers (Counsel), Julien Rocherieux (Counsel), Gauthier Martin (Counsel), Roy Charles Bates (Associate), Alice Latour (Associate) and Aurélien Lorenzi.
The European Investment Bank was advised by White & Case.
The White & Case team, directed by Paule Biensan (Partner), comprised Jacques Bouillon and Gilles Endréo (both Partners), Marianna Sédéfian and Emmanuel Lebaube (both Counsel), supported by Grégoire Karila, Jonathan Djenaoussine and Olivier Le Bars (Associates).
