WWW.LEXPERT.CA
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2016
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LEXPERT 13
"We're seeing fewer and fewer bank deals and
on larger projects almost exclusively bond financ-
ing," says Ilan Dunsky, National Co-chair of the
Infrastructure and PPP group at Dentons Canada
in Montréal.
"Even the European and Japanese banks who
were interested in these kinds of Canadian proj-
ects are being squeezed out by bond financing be-
cause the interest rates you can get on a bond are
so attractive. So the number of projects that are fi-
nanced by bond issuances and also the proportion
of each project that is financed by bonds is rising."
But that kind of structure may have clouds on
the horizon.
Ian Bendell, a foreign legal consultant working
with the global projects, infrastructure and public-
private partnerships group at DLA Piper (Canada)
LLP, says there are "points of contention" between
the rating agencies that rate the bonds and the way
long-term investors view the same projects.
"at's certainly something we've been seeing
more of, and that could be an interesting area to
watch over the next year," he says. "What seems
to be happening is rating agencies have looked at a
structure and taken a view that it should be rated
at a particular level, and the long-term investors are
looking at the same structure and asking whether
that rating is not too harsh.
"I think we're going to have to be a little careful
about the view long-term investors take as opposed
to the view the rating agencies are taking."
How will the market know if the issue flares up
into more than a few small skirmishes? One dead
giveaway: investors will turn their backs on an un-
derwritten bond, he says.
"In those circumstances the underwriters are
le holding the bonds, which, in the Canadian
market, is not what the underwriters generally
want to do," says Bendell, who works out of the
firm's Toronto office.
"What that will mean is either the structuring
will have to get tighter so the rating is agreed by
all three at the appropriate level or, alternatively,
you're going to find the spreads the underwriters
are creating are going to move out because they
don't want to be le holding the baby."
Not every deal is in the $5-billion range;
many infrastructure deals that involve green en-
ergy, public housing or climate change are signifi-
cantly smaller.
Carol Pennycook, a partner in the Toronto of-
fice of Davies Ward Phillips & Vineberg LLP,
says that, while the infrastructure bond market
remains robust, the Japanese banks in particular
have begun to show up again on these kinds of
projects "in in a big way.
"Bank of Tokyo-Mitsubishi UFJ have been very
active in renewable energy like wind and solar, and
Dunsky, Ilan Dentons Canada LLP
(514) 878-5833 ilan.dunsky@dentons.com
Mr. Dunsky is National Co-Chair of Dentons' Infrastructure and PPP group
and an active executive committee member of the global Infrastructure and
PPP group. Mr. Dunsky represents both domestic and international clients in
the development of infrastructure, public-private partnerships and project
finance, particularly in the energy, transportation and health sectors.
Dorion, Robert Gowling WLG
(514) 392-9506 robert.dorion@gowlingwlg.com
Mr. Dorion specializes in business law with an emphasis on corporate
commercial law, M&A and tax law. He has developed expertise in corporate
reorganizations, acquisitions, mergers and consolidations, contract
negotiating, public and private financing, and securities. His large clientele
includes public and private companies working in local, national and
international economic sectors.
Dietze, Sterling H. Stikeman Elliott LLP
(514) 397-3076 sdietze@stikeman.com
Mr. Dietze's domestic and foreign institutional financing and banking practice
extends to PPPs and infrastructure. He advises borrowers and lenders in
transactions including project finance, infrastructure financing, asset-based
financing, securitizations, syndicated loans and participation agreements,
international financial transactions and credit support documents.
Dépelteau, Jean-Pierre Dentons Canada LLP
(514) 878-8814 j-p.depelteau@dentons.com
Mr. Dépelteau is a member of the Construction and Infrastructure group
of Dentons Canada LLP's Montréal office, with over 40 years of experience
in the construction industry. Mr. Dépelteau provides legal and strategic
advice to a variety of public, semi-public and private-sector owners,
as well as construction contractors, specialized construction companies
and equipment suppliers.
David, Mylany Langlois Lawyers, LLP
(514) 282-7827 mylany.david@langlois.ca
Ms. David's real estate and commercial law practice encompasses the myriad
legal and financing aspects inherent in developing renewable energy and
infrastructure projects. Recognized in particular for her expertise in private
and P3 arrangements and in supervising extensive due diligence teams, she
negotiates on behalf of and advises developers, purchasers, governments
and financial institutions.
David, Guy Gowling WLG
(613) 786-0247 guy.david@gowlingwlg.com
Mr. David practises in domestic and international project finance, PPPs and
renewal energy financing, debt capital markets, aircraft and airport financing,
and financial regulatory law. He is co-author of David and Legault-Dooley,
The Annotated Bank Act.
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