LatinFinance - September/October 2013 - 39

BEST INFRASTRUCTURE LAW FIRM

be supportive.
Brennan says that even if global demand
for commodities slows in the short term,
its growth is assured over the long term. “I
think for Brazil, the mining sector is still a
very small segment of the economy and I
think that’ll only grow.” LF

WHITE & CASE

BEST SOCIAL INFRASTRUCTURE
FINANCING

DOIHI
With bonds backed
by government health
contracts, a Mexican
hospital financing
opens the way for further deals
When a specialty Mexican hospital sought
to raise cash in 2012, it had little inkling of
how involved the process would become.
But what quickly became clear was that
attempting to offer a bond that had never
before been tested in the peso market
would demand extensive marketing to
skeptical investors.
Yet the sale of the bonds by Desarrollo y
Operación de Infraestructura Hospitalaria
de Ixtapaluca (Doihi) ultimately proved
not only successful — it also marked a
significant advance for a new asset class. As
such, Doihi wins the award for Best Social
Infrastructure Financing.
The 1.9 billion peso ($156 million) bond,
backed by government contracts for health
services, was first discussed with investors
in November 2012, but the deal did not
price until May the following year.
“We had expected around three or
four weeks to roadshow the deal, and it
stretched to nearly eight,” says Emilio Grau,
chief financial officer at GIA Infraestructura,
the deal’s sponsor. “This was due to
investors’ interest in understanding the
project better — there were even some site
visits — to confirm the quality of the asset
we have.”
Doihi’s bond issue followed a similar type
of securitization from Mexican builder ICA
in 2011, which funded the construction of a
prison. In Doihi’s case, the novel structure
of the bond meant that investors spent

GOVERNMENT SUPPORT: Ixtapaluca
specialty hospital is opened by thenpresident Calderón in 2012

extra time scrutinizing aspects of the deal,
including the payment waterfall.
Pension funds were the natural investors
for the long-dated bond, which is why the
deal was funded through the bond market
rather than turning to bank lenders. And
indeed, the bulk of Mexico’s major afores
subscribed to the deal, which finances a
hospital in Ixtapaluca, not far from the
country’s capital.
“The investors were really interested,
but the fact that it was a new asset class,
and it was difficult to compare with other
assets, generated a lot of work,” says Grau.
“Even for the ratings agencies — HR gave us
a triple-A rating, and Fitch gave us AA+ — it
took them some work to understand the
project, and they even compared it with
some international projects.”
Grau is confident the transaction opens
the way for more deals of the kind. Indeed,
the company already has another project
in the pipeline that could come to market in
early 2014. LF

EMILIO GRAU, GIA

“THE FACT IT WAS A
NEW ASSET CLASS,
AND IT WAS
DIFFICULT TO
COMPARE WITH
OTHER ASSETS,
GENERATED A LOT
OF WORK”

An extensive infrastructure financing team
covering Latin America
makes White & Case an
important player in a
number of the region’s
most impressive deals
White & Case worked on two winning deals
in the LatinFinance 2013 Infrastructure
Financing Awards, as well as number of
strong shortlisted candidates in other
categories. It was also regularly cited by
competitors and infrastructure bankers
spoken to by LatinFinance for its substantial
experience in the field, particularly on
complex transactions.
The firm represented guarantors to
Largo Resources’ Maracás Vanadium
production project in Bahia, Brazil, which
wins Best Mining Financing. An innovative
project loan, the transaction called for
White & Case to work closely with the
parties involved, and in a tight time frame.
The firm represented Banco Votorantim,
Bradesco BBA and Itaú BBA, which
guaranteed the BNDES loan.
White & Case also represented BBVA,
BNP Paribas, Crédit Agricole, Santander
and Société Générale in the first two project
bond offerings for wind farm projects
in Mexico, Oaxaca II and Oaxaca IV. The
transactions win LatinFinance’s Best
Renewable Energy Financing award.
“What we brought to bear [on Oaxaca
II and IV] was that we had both the project
bond and project finance experience,”
says Someera Khokhar, who runs the
Americas section of White & Case’s energy,
infrastructure, project finance and asset
finance group. “Additionally, our prior
experience with Mexican capital markets
financings and payment and guaranty trust
structures were helpful factors.”
Khokhar highlights the firm’s long
history in Latin America — it started
operating in Brazil in the 1990s, for example
— as a contributor to its strength in the
region.

September/October 2013 - L ATINFINA NCE.COM 39
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