Chadbourne & Parke LLP represented Duke Energy in a US $100 million dollar denominated unsecured bond financing in the Peruvian capital markets. The deal closed Nov. 6.
The issuer, Duke Energy International Egenor, is a Peruvian subsidiary of Duke Capital. The issuer operates hydroelectric and thermal power plants in northern Peru and is dedicated to the generation and sale of electricity.
The first issuance of the bond program was for $40 million and was used to refinance a bridge loan facility that Duke Energy International Egenor had. Chadbourne worked on the bridge loan facility as well. The remaining amount of the bond program may be issued over a term of two years and may be used for the issuer’s corporate financing needs.
“I was impressed with the ease with which the transactions were executed and with the maturity of the Peruvian capital markets,” said Luis Oscar Souffront, Associate General Counsel for Business Unit Finance for Duke Capital and all of its subsidiaries.
According to Chadbourne partner Rohit Chaudhry of the Washington, DC office, what was especially interesting about the deal — given the investment climate in Latin America in recent years — was that the bond offering was oversubscribed by over 300% and the bonds were placed at a remarkably attractive interest rate of 3.75%.
The bonds have a five-year maturity date and received a rating of AAA from two Peruvian rating agencies.
Assisting Mr. Chaudhry on the deal was Chadbourne visiting attorney Micaela Garcia-Ribeyro of the Firm’s DC office.