Clifford Chance advised KfW IPEX-Bank on the financing of a state-of-the-art silicon metal production plant in Húsavík in the north of Iceland.

The credit amounts to a total volume of approximately US-$194 million (approximately EUR170 million) and has a 15 year-term. The financing structure includes a Hermes cover and untied loan guarantees under Germany’s UFK programme.

The project involves the construction of a plant to produce high-purity silicon metal which will be one of the most advanced silicon smelting plants in the world, capable of producing over 32,000 metric tons of high-purity silicon metal per year. The total project volume amounts to the equivalent of almost US-$300 million (approximately EUR265 million). The construction of the plant has been entrusted to SMS Siemag AG. The main investor in the plant is the German firm PCC SE.

Since it is an alloy metal, silicon is used primarily in the aluminium industry. It is also the higher quality silicon metal products for the chemicals, electronics and solar industries which drive growth in global silicon demand.

The Clifford Chance team was led by partner Dr. Dietrich F. R. Stiller and comprised senior associates Lena Hefele and Tanja Gropp as well as associate Kheiber Asar (all Banking & Capital Markets/Project Finance, Frankfurt). The due diligence was carried out by partner Markus Muhs (Corporate, Munich) and associate Florian Lechner (Corporate, Frankfurt).