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Leadership Capital for Infrastructure Development


VIETNAM

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The 29.7MW Coc San Hydropower Project in northern Vietnam’s Lao Cai Province


Asia’s Infrastructure Gap: What is at Stake Developing Asia will need to invest $26 trillion from 2016 to 2030, or $1.7 trillion per year* if the region is to maintain its growth momentum, eradicate poverty, and respond to climate change. Providing better access to quality, sustainable infrastructure is the key to many communities and economies in South and South East Asia reaching their full potential. InfraCo Asia provides responsible leadership in bridging the infrastructure gap that can’t be met by government or development bank funding at the early stage of project development. Through its project development and financing expertise, InfraCo Asia provides a catalyst for the private sector to invest in sustainable infrastructure projects in South and South East Asia. *Asian Development Bank estimate

With more than 800 million people in Asia lacking access to water, sanitation and electricity, inclusive growth means more investment in infrastructure – and making that investment more efficient. Christine Lagarde Managing Director, International Monetary Fund

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Who We Are InfraCo Asia’s Management Team members and Non-Executive Directors have extensive seniorlevel experience in the infrastructure and financing sectors and a range of regional contexts. Their expertise provides invaluable strategic guidance and support to InfraCo Asia’s Developer Teams and Joint Venture Partners.

Origin

Management and Board

InfraCo Asia became fully operational in 2010. InfraCo Asia is a company of the Private Infrastructure Development Group (PIDG), established in 2002 as a coalition of donors mobilising private sector investment to assist developing countries in attaining infrastructure vital to boosting their economic growth and combating poverty.

InfraCo Asia’s Management Team, led by the Chief Executive Officer, collectively bring the knowledge and capabilities to build and manage InfraCo Asia’s portfolio of investments, from project selection to business analysis, structuring, finance, risk management and compliance. InfraCo Asia, through its developer teams, actively participates in project origination and development.

Funding

One PIDG

InfraCo Asia is currently funded by three members of PIDG – the Australian Department of Foreign Affairs and Trade (DFAT); the Swiss State Secretariat for Economic Affairs (SECO) and the UK Department for International Development (DFID).

InfraCo Asia can draw on the expertise of its fellow PIDG companies to support project development and financial close. Each PIDG company plays a strategic role, either through providing technical assistance; early stage development; debt and guarantees or equity and hybrid financing.View PIDG companies here:

http://www.pidg.org/what-we-do/companies

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Organisational Structure InfraCo Asia is backed by the Private Infrastructure Development Group (PIDG) - a multi-donor organisation that promotes private infrastructure investment in developing countries through specialised financing and project development facilities and programs.

SIDA

DGIS & FMO

DutchMFA

IFC

KFW

KORAD

DFAT

SECO

UKAID

Private Infrastructure Development Group (PIDG)

Technical Assistance Facility (TAF)

DevCo

GuarantCo

InfraCo Africa

Equicap Asia

Infunde Development

The Emerging Africa Infrastructure Fund (EAIF)

Infra Capital Myammar

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The InfraCo Asia Management Team brings the knowledge and capabilities to build and manage the organisation’s portfolio of investments. 6


An experienced, dynamic Board guides InfraCo Asia’s work and champions the company’s innovative model. 7


What We Do Financial Close Early Stage Development

Concept

Advanced Development

COD

Construction

Commercial Operation

InfraCo Asia can bridge this gap

2 - 10% of Project Cost

Risk

Gap

Cost

Progress

The initial stages of project development require relatively little finance, but the high levels of risk can deter private sector investors. InfraCo Asia funds pre-financial close, early stage, high-risk infrastructure development activities by taking an equity stake in sustainable and commercially viable infrastructure projects. These contribute to economic growth, social development and poverty reduction.

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We incur the upfront costs and risks related to preparing and structuring infrastructure projects for private sector participation at an early stage, which would typically involve considerable time, resources and uncertainty for investors. Allard Nooy CEO, InfraCo Asia

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We step in where the private sector is initially unable or unwilling to invest. By mitigating early stage development risks, InfraCo Asia is a catalyst for private sector participation.


How We Invest Two Complementary Pools of Capital As part of the Private Infrastructure Development Group, InfraCo Asia can draw on distinct and strategic funding streams.

Development Capital Provides early stage development expertise and capital De-risks projects and creates “bankable” investment opportunities Invests as sponsor / joint owner, usually in partnership with local or international sponsors

Investment/Construction Capital Provides capital at or near financial close Bridges the gap when a project is unable to raise all the capital needed Participates as co-investor alongside private sector, usually taking a minority stake Flexible in form of investment: equity / mezzanine / debt finance

InfraCo Asia aims to exit from projects through sale of equity and/or refinancing, when the project is sufficiently de-risked, after commercial operation, or when it can attract private capital on its own merits. InfraCo Asia then recycles the proceeds into new projects.

PAKISTAN

The Metro Wind & Gul Ahmed Wind Power Projects 9 in Pakistan’s Sindh Province


VIETNAM

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Lao Cai Renewable Energy (LCRE) personnel at Coc San Hydropower Project


Where We Work

South Asia

South East Asia

Sector Coverage

Power and Energy

Telecommunication

Urban & Social Infrastructure

Logistics & Transport Infrastructure

Agriculture

Water & Waste Water

Oil & Gas Distribution

Waste Management

Manufacturing

InfraCo Asia does not participate in projects development that could have damaging environmental or social impacts. 11


Our Approach InfraCo Asia’s mandate is based on three core pillars that form our project selection criteria:

Development Impact Projects must be sustainable, reduce poverty and provide social and economic benefit while meeting environmental best practice. Projects must deliver development benefits by providing improved access to better infrastructure for lower income communities.

Additionality Our role is to complement, not compete. InfraCo Asia steps in where private sector developers, owners and operators are unable or unwilling to take on upfront risks and costs on their own with the private sector.

Commercial Viability Return for projects must be commercially attractive in order to mobilise private sector participation.

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PIDG companies each provide critical expertise on-the-ground. We keep a close watch on the opportunities and challenges faced in the countries where we work. Philippe Valahu

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CEO, Private Infrastructure Development Group


Our Model Developer Services Program InfraCo Asia’s Developer Services Program, which includes project origination, pre-financial close project development, EPC management and financial structuring activities, leverages three teams of contracted project developers. Equicap Asia provides developer services for South Asia Infunde Development provides developer services for South East Asia (excluding Myanmar) Infra Capital Myanmar provides developer services for Myanmar

Co-Development Program Complementary to the Developer Services Program, InfraCo Asia’s Co-Development Program involves investing in third-party projects to provide pre-financial-close development capital to projects that meet InfraCo Asia’s investment criteria. The Co-Development Program is managed by the InfraCo Asia Management Team. Details include: Third party developers take a majority or 50% stake and lead project development, and InfraCo Asia provides early stage risk capital, capped at 50% of development costs. InfraCo Asia provides project development and financing expertise, along with corporate governance oversight that helps bring projects from development stage to financial close. In return for development funding and assistance, InfraCo Asia will have the right to an equity stake in the project, board positions, and exit with returns on its investments. InfraCo Asia aims to exit from projects as soon as feasible: at financial close, when the project is sufficiently de-risked, after commercial operation, or when it can attract private capital on its own merits. 13


Our Impact Based on InfraCo Asia’s projects in operation or under construction, more than 2 million people in South and South East Asia are benefitting from, or will benefit from, access to new or improved infrastructure. In Vietnam, InfraCo Asia’s run-of-river Coc San Hydropower Project provides almost 30MW of clean energy generation capacity and approximately 110 GWh per year of clean energy. Local owner/operator Lao Cai Renewable Energy runs a Community Development Program that constructed access roads, rehabilitated schools and built small-scale irrigation projects. A Livelihoods Restoration Program assists people whose land was impacted by the project to reinstate incomeproducing activities. It provides agricultural supplies and scholarships enabling the children of poorer families to attend school and buy books and uniforms. Pakistan’s power capacity shortfall of more than 5,000 MW is equal to about one third of total demand on the system. Industry, businesses and households all bear the burden of unreliable power, and an estimated 2-3% of national GDP is lost. InfraCo Asia’s Metro and Gul Ahmed Wind Power Projects, with a combined generation capacity of 100MW, provide approximately 310 GWh of clean energy per year, supporting industry and creating jobs. The projects benefit almost 700,000 people through access to a more reliable, affordable power supply. Wherever InfraCo Asia develops and implements a project, we aim to enrich our host communities. From employment opportunities to livelihood enhancement and community development programs, we add to the opportunities available to local people.

View InfraCo Asia’s full project portfolio at www.infracoasia.com/projects.asp 14


Based on InfraCo Asia’s projects in operation or under construction, more than 2 million people in South and South East Asia are benefitting from, or will benefit from, access to new or improved infrastructure.

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“

At the highest level, InfraCo Asia’s role is providing leadership for private, institutional and strategic investors to come into markets that they may not understand; that they quite justifiably have risk aversion to. John Walker

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Chair, InfraCo Asia


Vision for the Future Each time InfraCo Asia brings a sustainable infrastructure project to a point where the private sector is attracted to invest, a success story is born. We provide leadership capital and infrastructure development and financing expertise to unlock private sector capital. As we deliver projects that provide access to new or improved infrastructure, we demonstrate a powerful proof of concept. Nothing entices private sector participation more effectively than real, working examples of success. InfraCo Asia’s unique structure means we can go where others fear to tread. The more early stage infrastructure projects that are successfully de-risked, the better the business and local community’s appreciation for what is possible. Many of InfraCo Asia’s projects are highly replicable. As a leader in its field, InfraCo Asia is playing a critical role in the creation of private infrastructure industries. Beyond this, it is capturing people’s imaginations and building a real bridge between opportunities for private sector investors and those most in need of access to quality infrastructure.

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Work with Us Partners

Projects

InfraCo Asia’s key expertise is in the early stage development of infrastructure projects. We are happy to discuss genuine proposals with governments, businesses and individuals.

We are interested in Projects located in South East Asia (including Myanmar) and South Asia that may be ideal candidates for InfraCo Asia’s Co-Development Program.

Bridge the Gap Join us in unlocking the private sector capital that is so critical to bridging the infrastructure gap in emerging Asia. Enquiries are welcome.

InfraCo Asia Development Pte. Ltd. 9 Raffles Place Level 18, Republic Plaza II Singapore 048619

InfraCo Asia

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T + 65 6823 6860 E info@infracoasia.com W www.infracoasia.com

www.PIDG.org

InfraCo Asia

Private Infrastructure Development Group

@InfraCoAsia

@pidgorg


Leadership Capital for Infrastructure Development

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www.infracoasia.com

Company Registration No. 200901920D 20

InfraCo Asia Corporate Brochure  

Find out more about InfraCo Asia's unique model and mandate: sustainably developing early-stage infrastructure projects in South and South E...

InfraCo Asia Corporate Brochure  

Find out more about InfraCo Asia's unique model and mandate: sustainably developing early-stage infrastructure projects in South and South E...