September 2, 2020

Milbank Advises Arrangers and Lenders in Innovative Power Financing in Colombia


Milbank LLP represented the lenders in connection with the dual-currency USD$275 million and COP$226 billion financing for Caoba Inversiones, an investment platform developed through a joint venture between Colombian energy key player Celsia and Cubico Sustainable Investments (owned by Ontario Teachers’ Pension Plan, Canada’s largest single-profession pension plan and PSP Investments, one of Canada’s largest pension investment managers) to own, operate and develop power transmission assets with predictable and stable long-term cash-flows.

The purpose of the financing was to both fund the acquisition from Celsia Colombia of certain operating power transmission assets, and to develop additional power transmission infrastructure in Colombia. To date, the investment platform has acquired through an asset purchase transaction with Celsia Colombia two projects: Tolima, an operating power transmission business, and Toluviejo, a new power transmission line currently under construction.

The Milbank deal team was led by Global Capital Markets Carlos Albarracin and Global Project, Energy and Infrastructure Finance partner Jaime Ramirez, with Global Capital Markets associate Ana Bueno and International Attorney Juan Pablo Aspe and Global Project, Energy and Infrastructure Finance associate Daniel Rios Zertuche.

Mr. Albarracín said: “We are pleased to have advised the lenders on this important and groundbreaking transaction in Colombia that will allow Celsia and Cubico to continue investing in power transmission assets through a 'YieldCo style' investment platform. This transaction exemplifies the multidisciplinary approach of our Latin America practice, successfully combining sophisticated project and corporate finance techniques.”

Milbank continues to have a strong presence in Colombia. Milbank’s other recent major transactions in Colombia include the recent representation of Grupo Energía Bogotá (GEB) in its $400 million offering of 4.875% senior notes due 2030, the underwriters in the $2 billion bond offering by Ecopetrol (Colombia’s state-owned oil and gas major) and TGI (Colombia’s largest gas transmission company) in the $750 million Rule 144A/Reg S. The firm has also advised on the financing for the purchase of Zona Franca Celsia, the owner of the 610 MW Termoflores power plant and the financing in connection with the Alupar transmission line.