Firms: Allens (Plenary); Herbert Smith Freehills (bank financiers)
Deal: A Plenary-led consortium has approved a refinancing deal for the Victorian Comprehensive Cancer Centre (VCCC).
Value: $1 billion
Key players: The Allens team advising Plenary was led by partner James Darcy (pictured). Associate David Yang and lawyer Emily Rothfield assisted on the deal.
Sidley Austin acted for Plenary as its US counsel, while Greenberg Traurig was counsel for the bondholders.
The initial bank debt has been refinanced with a 24-year bond deal worth $450 million, involving domestic and offshore bond investors. The deal also includes a bank debt tranche that will last for 11.5 years.
The deal is a significant one for the infrastructure funding market in Australia, according to Allens partner James Darcy.
Mr Darcy, who advised Plenary on the refinancing, is the head of Allens’ debt capital markets team in Melbourne. In his view, the deal signifies the return of “long-term bond financing for PPPs in Australia”.
Since the GFC, Mr Darcy said, shorter-term bank debt has been the preferred funding option for Australian infrastructure.
He believes that more players in the infrastructure space are now looking to debt capital markets to diversify the debt of their single-asset companies.
“The VCCC bond deal demonstrates the opening up of long-term bond financing opportunities for infrastructure projects in Australia,” Mr Darcy said.
“We are now seeing increasing activity from infrastructure companies seeking diversification in the debt capital markets, both domestically and offshore. This is particularly the case for brownfield assets with an operating history and predictable cash flows, such as VCCC,” he said.