November 28, 2011 â€" International law firm Milbank, Tweed, Hadley & McCloy LLP, led by Project Finance partner Dan Bartfeld and senior associate Sarah Glenn, represented the Inter-American Development Bank (IDB) and the four international commercial participants, Caixa Geral, HSBC, Santander and WestLB AG, in connection with their US$430 million syndicated financing of the construction, operation and maintenance of a new private mixed-use container and liquids terminal in Brazil's Santos Port. A parallel financing of approximately R$633.4 million will be provided by Caixa Econômica Federal through a repasse loan provided by BNDES, to complete the total senior debt financing package of approximately US$786 million.
The IDB A/B loan was signed with Empresa Brasileira de Terminais Portuários S.A. (Embraport), which is responsible for the project. The Embraport Terminal aims to ease congestion and reduce costs at Santos, the leading port in Brazil for container traffic and the largest port in Latin America. Once constructed, the terminal will be the largest private port terminal in Brazil. With total project costs of over US$1 billion, this will be the largest port project ever financed in Latin America on a limited recourse basis.
"We are honored to have worked with IDB and the commercial banks on the most important port ever project financed in Latin America," said Mr. Bartfeld. "In order to support Brazil's rapid growth, there will be an increased number of transportation infrastructure projects developed by world-class companies like Odebrecht and DP World."
Project Finance associate Sarah Glenn, who assisted on this deal commented, "This project shows that even in challenging economic climates, a well-structured project can be financed on a project finance basis."
The loans from IDB and CEF/BNDES will fund the first phase of the new terminal, which will have an expected capacity of more than 1 million TEU (a measure that refers to number of 20-foot containers that the facility can handle per year) and will be able to handle liquid bulk. The project will improve the Santos Port's capabilities to receive a new generation of deeper-draft container ships, which have already become commonplace in the global shipping market, helping reduce waiting lines outside the port.
The new terminal will also contribute to improved traffic conditions in the city because it will have adequate road and rail connections, and will be located away from the congested urban area of Santos itself. The new terminal will create approximately 1,500 direct jobs during construction as well as 550 employees at the outset of the operation and 1,500 at full capacity.
Additional Milbank attorneys involved in this transaction include Project Finance associates Timothy Fitzpatrick, Vanessa Ortblad and Jeff Leider.
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About Milbank's Latin America Practice Group
Milbank's Latin America Practice Group is one of the most successful and diverse practices in the Latin American region. For the past three years, Milbank has been named the Top Project Finance Law Firm in Latin America by Chambers Latin America. Attorneys in the Group have advised clients on some of the largest and most innovative transactions in nearly every country throughout Latin America, including Argentina, Brazil, Chile, Colombia, the Dominican Republic, Mexico and Peru. The Latin America Practice Group specializes in Securities, M&A, Project Finance, Private Placements and Litigation & Arbitration.