BKM | Berkemeyer was hired by Rutas del Este S.A., a PPP Contractor for Route PY02, to advise on the financing of the additional work of Route PY02: New Variant Itacurubí de la Cordillera (“NVI”), materialized through a loan granted by the Bank ‘Banco Sudameris.’
With the purpose of reinforcing the social aspects of the project, by means of the Addenda N° 2 to the PPP Contract, the Ministry of Public Work and Communications (the “MOPC”) and the company Rutas del Este S.A. have decided the possibility of the inclusion to the PPP Contract of new works linked to the NVI; and next, through the subscription of the Addenda N° 3 to the PPP Contract, the MOPC and Rutas del Este S.A. have established the contractual bases for the effective incorporation to the PPP Contract of the new works, which shall give continuity to the urban zone of the city of Itacurubí de la Cordillera.
In view of the aforesaid, the past September 6, Rutas del Este (a limited liability company of specific purpose integrated by the local company Ocho A and the Spaniard company Sacyr Concesiones), the concessionaire in charge of the execution of the project of duplication and extension of the Route PY02, under public bid with the modality of Public-Private Partnership, was successful in obtaining from SUDAMERIS BANK S.A.E.C.A. a loan in the amount of USD 29,800,000 to finance the works of the NVI.
It is worth to point out that this is the first project of public-private partnership in Paraguay (30 years of concession, capex of USD 550,000,000) and the first financing obtained by Rutas del Este S.A. included the issuance of bonds under the Rule 144A / Reg S structured by Goldman Sachs and a loan by the IADB Invest. In December 2021 it was carried out a process of refinancing of the loan granted by the IADB Invest through a private allocation of notes under the Section 4(a)(2) of the Securities Act of 1933 of the United States of America in an amount of USD 218,500,000 for 15 years.
The BKM Team consisted in Martin Carlevaro (Partner, Head of Infrastructure and Project Finance, Manuel Arias (Partner, Head de Banking & Finance) and the Associates Adriana Ocampos and Alvaro Rojas.
Also participated Juan Guiñazu and Sofia Suarez, internal lawyers of Rutas del Este S.A.
We thank Rutas del Este and Sponsors for renewing their confidence in BKM and we congratulate the Sudameris Bank and its advisers, the Firm Gross Brown for the successful closing of the transaction.