31 Aug 2021
EUR 215mn agreement to finance two major hospital projects in Ghana
First independently certified Social Export Credit Loan in Africa in the healthcare sector.
Today Investec Bank Ltd announced the signing of a EUR 215 million agreement to finance two major hospital projects in Ghana. The financing consists of two loans in favour of Ghana’s Ministry of Finance where Investec acted as sole mandated lead arranger (MLA) for both loans.
The first, backed by Swedish Export Credit Agency (EKN) and funded by Swedish Export Credit Corporation (SEK), is a EUR 189 million loan with a tenor of 13 years, with re-insurance from Atradius DSB. The second is a EUR 26 million commercial loan arranged and structured by Investec to cover the down payment - supported by Export Credit Insurance Corporation of South Africa (ECIC) and funded by Investec.
The Engineering, Procurement and Construction (EPC) contract for the projects will be carried out by Amandi Investment Ltd, with Bluebird Finance & Projects Ltd acting as lead financial advisor for the EPC.
Acre Impact Capital acted as impact adviser to Investec, ensuring the loans are fully aligned with Loan Market Association Social Loan Guidelines (2021) and eligible for an independent Second Party Opinion certifying the same from DNV.
Charles Kofi Adu Boahen, Minister of State at the Ministry of Finance for the Republic of Ghana, said: “The projects are part of the Republic of Ghana’s initiative to dramatically expand and develop its regional healthcare infrastructure and services, significantly improving access to quality healthcare services in the post COVID environment for a population of 3 million people in an area covering 24,000km in the western region.”
The funding will be used to rehabilitate the Effia-Nkwanta Hospital and construct a new Hospital in Agona.
Once complete the combined hospitals will include a centre of excellence for maternity, obstetrics, gynaecology, and neonatal care (NICU), with 500 beds and over 40,000m2 of modern medical floor area and 6,000m2 of staff housing. They will also provide a trauma and emergency unit, a burns unit, a medical imaging lab, advanced laboratory services and a cath lab/angiography and chemotherapy unit. Training will be provided to physicians, nurses and paramedics as part of the project implementation.
The involvement of EKN and SEK reflects the significant number of Swedish sub-suppliers participating in the project, with the Export Credit Agencies’ backing helping secure a highly favourable borrowing rate. Charlotte Akesson, Senior Underwriter at EKN comments: “EKN's mission is to enable financing of the purchase of Swedish high-quality service and equipment. It is particularly rewarding that EKN has participated in this important project enabling the delivery of world-class health care facilities that will make a significant improvement to the social infrastructure in the region and which supports the UN Sustainability Goals.”
Brian Irvine, Head of African Structured Debt and Trade Finance at Investec added: “This transaction demonstrates the growing capacity of African domiciled banks and financial institutions to structure and arrange debt financing for African projects and trade. We are proud to close this financing so soon after the recent EUR 600m western rail project.”
Working with Investec on the commercial loan, Mandisi Nkuhlu, COO at ECIC, said that: “ECIC is delighted to again partner with Investec in arranging the finance for another critical infrastructure project in Western Ghana and in doing so, secure significant export contracts and jobs for South Africa as well as intra-African trade.”
Ram Shalita, CEO of Bluebird Finance and Projects added: “Bluebird is delighted to have worked with Investec, EKN, SEK, ADSB, and ECIC to structure and arrange this socially impactful financing.”
“This financing demonstrates the critical role export finance can play in delivering high impact affordable social infrastructure as the industry looks forward to the publication of the White Paper on Sustainability in Export Finance this September,” concludes Chris Mitman, Head of Export Finance at Investec.
Investec partners with private, institutional, and corporate clients, offering international banking, investment, and wealth management services in two principal markets, South Africa and the UK, as well as certain other countries. The group was established in 1974 and currently has approximately 8,200+ employees. Investec has a dual listed company structure with listings on the London and Johannesburg Stock Exchanges. Investec’s current market capitalisation is approximately £3 billion.