The Inter-American Investment Corporation (IIC), the private sector arm of the IDB Group, has closed on a landmark 19.5 years amortizing B-bond for US$135.8 million to finance the operation of the 70 MW Uruguayan wind farm Campo Palomas. The project is developed by Invenergy, a global leader in renewable energy projects. The transaction marks the first B-bond issued in connection with an IIC A loan and the second such structure deployed by the IDB Group – the first one being the IDB’s Reventazon Hydroelectric Plant in Costa Rica.
Last year, the IIC, in conjunction with DNB Bank ASA (Norway), provided an A/B loan to finance the construction of the wind farm. Following construction completion, the IIC and DNB Markets, Inc. structured a B-bond to refinance the existing A/B construction loan. The B-bond, which benefits from IIC’s umbrella, generated high levels of interest from international institutional investors, resulting in an over-subscription. The B-bond also received a green bond certification from DNV-GL and Baa3 international rating from Moody’s.
This transaction deepens the capital markets interest in the nascent Uruguayan non-conventional renewable energy market, which has grown to represent more than 20% of the energy generated in the country. The B-bond, developed by the IDB Group, is a product designed to allow institutional investors to participate under the A/B loan program.
The A/B loan structure is widely used by multilaterals to mobilize international commercial banking institutions into emerging countries. It is an example of how the IIC can mobilize funding from institutional investors into Latin American renewable infrastructure assets through innovative structures and distribution methods.
About the Inter-American Investment Corporation (IIC)
The Inter-American Investment Corporation (IIC), a member of the Inter-American Development Bank Group (IDB Group), is a multilateral development bank committed to supporting the private sector in Latin America and the Caribbean. The IIC finances sustainable enterprises and projects to achieve financial results that maximize social and environmental development for the region. With a current portfolio of $11 billion under management and 350 clients in 21 countries, the IIC works across sectors to provide innovative financial solutions and advisory services that meet the evolving demands of its clients.
About the IDB
The Inter-American Development Bank is devoted to improving lives. Established in 1959, the IDB is a leading source of long-term financing for economic, social and institutional development in Latin America and the Caribbean. The IDB also conducts cutting-edge research and provides policy advice, technical assistance and training to public and private sector clients throughout the region.
- José Luis Lobera