Investment financing programs
Investment financing programs
OPIC provides medium- to long-term loan guarantees, or even direct loans to ventures that involve significant equity and management participation by American business. The loans are available principally for project financing, and OPIC's participation is based primarily on the economic, technical, marketing, and financial soundness inherent in the project. Since it is nonrecourse financing, there must be an adequate cash flow to pay all operational costs, to service all debt, and to provide the owners with an adequate return on investment.
In such project situations, assuming the know-how and experience of the project directors is evident, and sponsors need not pledge their own general credit. OPIC must satisfy itself that the financial plan includes an agreement that provides for unforeseen events, such as cost overruns, to assure project completion. Therefore, the financial capability to perform under the agreement must be assured. When project financing is not practical, OPIC will consider more conventional secured lending techniques.
While the financing might be for a wholly owned American investor project, OPIC encourages joint ventures with local citizens or corporations. OPIC will assist in structuring and coordinating its loan with other lenders, including private banks and Eximbank. On a new project OPIC might participate up to a maximum of 50 percent. On expansion of a successful business, OPIC might consider 75 percent. Here also, OPIC gives priority to energy industries, including alternate energy sources.
Relative
alternate energy sources financial soundness project situations financial capability american investor direct loans loan guarantees private banks adequate return secured lending project directors technical marketing financing programs project financing energy industries unforeseen events project completion operational costs overruns opic
OPIC provides medium- to long-term loan guarantees, or even direct loans to ventures that involve significant equity and management participation by American business. The loans are available principally for project financing, and OPIC's participation is based primarily on the economic, technical, marketing, and financial soundness inherent in the project. Since it is nonrecourse financing, there must be an adequate cash flow to pay all operational costs, to service all debt, and to provide the owners with an adequate return on investment.
In such project situations, assuming the know-how and experience of the project directors is evident, and sponsors need not pledge their own general credit. OPIC must satisfy itself that the financial plan includes an agreement that provides for unforeseen events, such as cost overruns, to assure project completion. Therefore, the financial capability to perform under the agreement must be assured. When project financing is not practical, OPIC will consider more conventional secured lending techniques.
While the financing might be for a wholly owned American investor project, OPIC encourages joint ventures with local citizens or corporations. OPIC will assist in structuring and coordinating its loan with other lenders, including private banks and Eximbank. On a new project OPIC might participate up to a maximum of 50 percent. On expansion of a successful business, OPIC might consider 75 percent. Here also, OPIC gives priority to energy industries, including alternate energy sources.
Relative
alternate energy sources financial soundness project situations financial capability american investor direct loans loan guarantees private banks adequate return secured lending project directors technical marketing financing programs project financing energy industries unforeseen events project completion operational costs overruns opic
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