Mayer Brown advised the United States International Development Finance Corporation, the US government’s international development bank, as political risk insurer in connection with a $1 billion financing for El Salvador for the repurchase of $1.031 billion of its outstanding bonds at discount for par.
Savings generated by the transaction will be applied over time to support conservation, water security, and ecosystem restoration in the Lempa River (Rio Lempa) watershed, one of the longest rivers in Central America. Projects funded by the savings from the transaction are expected to enhance water quality, quantity, and reliability; strengthen climate resilience; protect the watershed’s natural ecosystem; and mitigate water security risk in the region.
JPMorgan Chase Bank, N.A. acted as sole arranger and lender and J.P. Morgan Securities LLC acted as dealer manager in the tender offer. The Development Bank of Latin America and the Caribbean provided a $200 million standby letter of credit. The debt conversion allows El Salvador to realize savings through reduced debt service costs and thus generate funding for the Rio Lempa Conservation Program over the next 20 years. The Rio Lempa Conservation Program will be developed and implemented by Catholic Relief Services and Fondo de Inversion Ambiental de El Salvador.
The Mayer Brown team was led by partners Gaby Sakamoto, Rob Flanigan, Sarah Garvey, and Peter Pears, and associates Luis Schrader, Craig Holburd and Yamina Centurion in the firm’s Washington DC, London, and New York offices.