Zhejiang University Insigma Group, advised by King & Wood Mallesons (KWM), successfully completed the issuance of CSC Financial-Insigma Jianshe Investment Qingchun Road Tunnel PPP special ABS. The project is the largest of the first four approved projects nationwide and the first PPP securitization project in Zhejiang Province, after the Notice of Promoting Securitization of Public and Private Partnership (PPP) Projects in the Traditional Infrastructure Sector was released jointly by the National Development and Reform Commission and the China Securities Regulatory Commission.

China Financial Co., Ltd (CSC Financial) acted as administrator for the project, and Industrial Bank, Zheshang Bank and Bank of Nanjing completed their subscriptions as investors. In this project, the preferred asset-backed stock offerings were issued in two tranches: Class A of RMB700 million, interest rate 4.05%, maturity 14 years, rated AAA, redemption or repurchase term 2 years; and Class B of RMB400 million, interest rate 4.15%, maturity 14 years, rated AAA, redemption or repurchase term 3 years. The underlying PPP project is the BOT project of Hangzhou Qingchun Road Tunnel, the first large-scale urban infrastructure project with private capital introduced using BOT mode in Hangzhou City and Zhejiang Province. Construction started in 2006, and the project was completed and put into operation in 2010. It served as an important link across the Qiantang River during the Hangzhou G20 summit in 2016.

KWM acted as counsel in the project. Despite an extremely tense timetable, the KWM team completed the structuring, due diligence, legal documentation, liaison and communication with regulatory authorities, legal opinion and other professional work with high efficiency and quality service. They also coordinated with other project agencies, and eventually assisted Insigma Group with successful issuance, which helped KWM earn recognition from the client and other parties in the project. The leading partners were Jiang Conghua and Eddie Hu, supported by Zhou Yuanyuan and Shi Shengjie.

Jiang Conghua commented, “Speaking of setting an example, as the first securitization project of a traditional infrastructure project, this project will encourage a new way of thinking for other similar infrastructure projects in docking capital market for financing. Teamed up with Partner Eddie Hu’s team, which specializes in securitization, infrastructure projects and PPP, combined with our forward-looking innovative solutions and services, we were able to assist our client to complete another landmark project. Since its policy was launched in last December, the landing of the first batch of PPP securitization projects took only four months. As an innovative way of financing, it is important to utilizing PPP stock assets, attracting more private capital to PPP projects, and promoting the sustainable and healthy development of the PPP model in China.”