Middle East & Africa Deals of the Year 2023: Mega and multi-tranche
The region’s highest-profile deals combined new technologies and new distribution tactics.
Despite an increase in volumes between 2022 and 2023, the Middle East slipped a place from third to fourth as the most popular region for financings, and Africa, while maintaining its lowly position, recorded a reduction in volumes.
This masks a very encouraging picture for the evolution of infrastructure in both regions. In Saudi Arabia, the vast NEOM Green hydrogen deal set a global benchmark for the technology, while the refinancing of the acquisition of Saudi Aramco’s pipeline assets set project bond records.
The strong potential that the region enjoys in wind and solar is likely to encourage new development of renewables and green hydrogen projects, and attract solid ECA support. In fact three of the four Middle Eastern winners had a heavy ECA component.
The two African deals featured in one instance the arrival of developed market leveraged infrastructure finance techniques and in the other a landmark PPP transaction for a transport asset. The future of PPP may well lie in frontier markets. Certainly DFIs are willing to make it attractive to governments.
The winning transactions from the Middle East were all represented at Exile Group’s MENA 2024: Project, Agency & Development Finance event in Dubai
Middle East & Africa Emerging Energy - NEOM Green Hydrogen
The clear standout financing in the Middle East in 2023, or any region in any year. This was the major limited recourse financing for a green hydrogen project that the market was waiting for. Huge, and likely to be hugely influential.
Middle East & Africa Chemicals - Ras Laffan Petrochemicals
This joint venture between QatarEnergy and CPChem is developing the largest petrochemical project in Qatar. This combines a classic financing structure - blending commercial bank and Islamic financing with ECA direct and covered tranches - with modern ESG-focused emissions reduction technology
Middle East & Africa Refinancing - Greensaif Pipelines
The BlackRock-led group of buyers of Saudi Aramco’s pipeline assets refinanced their bridge financing with a complex blend of a GMTN programme and a Wakala-Murabaha sukuk issuance. The deal was a feat of both distribution and the management of intercreditor issues
Middle East & Africa Renewables - Ras Ghareb Wind
The deal marks a first in combining debt from Japanese ECA and the EBRD, which required the lenders to break new ground in deal documentation. Despite Egypt’s economic troubles, the project - thanks to the financing - will make a cheap and meaningful contribution to the country’s decarbonisation
Middle East & Africa Transport - Cabo Verde Airports
IFC, Proparco and DEG - no strangers to operating in frontier markets - made their first major investment in Cabo Verde, and their first sustainability-linked loan to an airport project. The long-dated debt and swaps package from the three lenders gave Vinci the confidence to make its first PPP investment in Africa.
Middle East & Africa Acquisition - Infinity's Lekela Acquisition
Lekela is the largest M&A transaction for a portfolio of African renewables assets. It also marked the first use of a holdco-level financing for assets in more than one African country. The dual-currency financing was a landmark for commercial bank lending to the sector.
