Business Theories of Project Finance

Takao Higuchi
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Takao Higuchi: Nagashima Ohno & Tsunematu

Chapter Chapter 3 in Natural Resource and PPP Infrastructure Projects and Project Finance, 2019, pp 103-180 from Springer

Abstract: Abstract With a background understanding of NRI-PPP Projects discussed in Chap. 2 , in this chapter I move on to examine project finance. To understand the business theories of project finance, I go over fundamental understandings regarding project finance and the “pros and cons” of entering into a project finance transaction from the perspectives of the major parties (i.e., the Sponsor, the Senior Lender and the Host Country/Off-taker). My discussion of project finance deepens to address its essence and particular characteristics including a Debt-Equity Ratio, waterfall provisions and cash flow structure. Finally, I end by analyzing important characteristics of the Security Package established by the key financing agreements including security interests and step-in right.

Keywords: Final Project; Senior Lenders; Cash Flow Structure; Project Finance Transactions; Senior Loan (search for similar items in EconPapers)
Date: 2019
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Persistent link: https://EconPapers.repec.org/RePEc:spr:eclchp:978-981-13-2215-0_3

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DOI: 10.1007/978-981-13-2215-0_3

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