Page 11 - PowerPoint Presentation

SOURCES AND FORMS OF FINANCE

Project finance (including public-private

partnerships)

• Project finance for large-scale projects often consists of

debt and equity obtained from a multitude of sources.

• Debt finance includes bond finance and debt from banks,

developing finance institutions and aid agencies. Investors,

known as sponsors, often provide some equity financing.

• Often these sources of finance are then supplemented by

governmental grants.

• It is common practice to create a special purpose entity

for such a project; this entity then owns no other assets,

except for the project. (This may serve to ring-fence the

sponsors in case of project failure.)

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