on equity investment by such organizations, as despite these examples, it remains uncommon. Additionally, willingness to invest as a lender or equity sponsor by such organizations will depend a great deal on the location of a project. Multilateral organizations tend to favor projects that will serve particular regions, especially emerging markets (e.g., Asia Development Bank, Inter-American Development Bank). Multilateral organizations are sometimes willing to perform other roles. They can act as guarantors (generally partial guaranties of bonds or loans), insure against political and currency risk, provide grants for feasibility studies, provide technical cooperation, and act as second debt arrangers/ providers (typically through “B Loans” where the development agency acts as administrative agent and syndicates loans to other commercial banks). In their role as lender, multilateral organizations
funding for a submarine cable project will take a significant amount of preparation. To succeed, sponsors will need to identify a market opportunity and prepare a credible business plan that includes a firm commitment from an appropriate technology vendor and that incorporates a wellconsidered financing plan. Only then should sponsors seek to secure and structure funding from external investors.
often provide better terms than commercial banks. They can be particularly valuable as capital structure partners in locations where legal and regulatory structures are underdeveloped, because they may facilitate local permitting and thereby reduce the legal and regulatory risk from government consent and licensing periods that often plague such locations.
organizations does have a downside. Multilateral organization investment is often contingent on conditions that are more rigid than those typically imposed by commercial lenders (e.g., covenants related to child labor, collective bargaining, higher environmental standards, etc.).
But
Successfully
involving
such
Securing Financing: securing
the
Investors demand a clearly identified and justified target market. Credible and well-developed business plans that articulate specific opportunities in underserved areas, or in regions that require broadband and IP-enabled communications to cope with demand, are the plans that will command the attention of investors. South Asia and Latin America in particular are prime regions to search for such opportunities, as investors tend to favor them. In addition to articulating an opportunity, sponsors will need a comprehensive and credible business plan. At a