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ADB invests US$95 million in Clifford Capital
Deal aimed at supporting sustainable infrastructure projects in developing Asia
18 Sep 2020 | Chito Santiago

The Asian Development Bank (ADB) is investing up to US$95 million in Clifford Capital Holdings (CCH), a Singapore-based specialist financing and distribution platform for infrastructure and other real assets globally. ADB’s investment will help to fund CCH’s future growth plans, including in sustainable infrastructure financing in developing Asia.

The transaction, announced on September 17, comprises a US$50 million investment from ADB and a US$45 million investment from the Leading Asia’s Private Sector Infrastructure Fund (LEAP) to be administered by ADB. It is the ADB’s first investment in a Singapore entity since the opening of its Singapore office in March this year. The investment will give ADB a shareholding interest of 6.3% in CCH immediately post-closing and a pro-forma stake of 10.8% once all equity capital committed has been fully deployed.

In investing in CCH, the director-general of ADB’s private sector operations department Mike Barrow cites the company’s ability to attract long-term institutional capital to developing Asia and the Pacific, which he says requires US$1.7 trillion annually in infrastructure financing through 2030 to maintain growth, tackle poverty and address climate change.

As ADB points out, most infrastructure investment in Asia is financed by the public sector, but those resources are not enough to meet the region’s infrastructure financing needs. Greater public funding for Covid-19 responses will spur a greater reliance on private sector funding to close the gap. It says CCH’s focus on financial innovation through securitization can help to meet these financing needs. Through its innovative and competitive financing solutions, CCH can help to position Singapore as a full-service infrastructure financing hub in the region.

Clifford Capital Pte, acting as a sponsor, successfully priced the first infrastructure project finance securitization in Asia in July 2018 with Bayfront Infrastructure Capital issuing four classes of notes. The landmark deal saw the creation of a new asset class to facilitate access by institutional investors to infrastructure debt in Asia Pacific and the Middle East.

CCH is an integrated alternative investment platform with complementary companies, offering origination, distribution and investment management capabilities in the real assets sector, and operating on a financially sustainable and commercial basis. It aims to help address the substantial infrastructure financing gap in Asia, while closely aligning with Singapore’s economic growth initiatives in the infrastructure, maritime and other real assets sectors.

LEAP was established in 2016 with a US$1.5 billion capital commitment from the Japan International Cooperation Agency. It is focused on delivering high quality and sustainable private sector infrastructure projects that reduce carbon emissions, improve energy efficiency, and offer accessible and affordable health care, education and communication services to ADB’s developing member countries.

In May this year, Clifford Capital announced the closing of the US$140 million senior secured term loan financing for Summit Gazipur II Power Limited, which was earmarked for the development, construction and operation of a 300MW oil-fired power plant in the Gazipur district in Bangladesh. The transaction is the first independent power project in Bangladesh to be funded solely by international commercial financing institutions. Previous projects had been financed substantially by development finance institutions and multilateral development banks.

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