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STREET TALK Jun 13 2017 at 12:15 AM

Updated Jun 13 2017 at 12:15 AM Save Article Print License Article Reliance Rail refi back on the agenda; NSW takes pitches
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Reliance Rail - which helped finance NSW's Waratah fleet of trains - is due to be refinanced and parties involved are readying for another round of talks.

Domino Postiglione

by Sarah Thompson Anthony Macdonald Joyce Moullakis
The country's busiest band of government dealmakers, NSW Treasury, is back in the market with another investment bank mandate.

Street Talk understands NSW Treasury recently wrote to investment banks and accounting firms seeking a financial adviser to hold its hand through trains project Reliance Rail's $2 billion refinancing.

It's understood pitches went into the government about a fortnight ago, and a new mandate is expected to be signed as early as this week.

Investment bank Lazard headed into the pitching in pole position, given its existing contract to advise the state on options for the Reliance Rail PPP. However, that contract is due to expire in early July and some personnel changes at Lazard ensured some competition for the new role.

Accounting firm PwC and Fort Street Advisors are among the firms believed to be seeking the mandate.

It comes as NSW prepares for Reliance Rail's refinancing. The trains project's debt is due to expire in 2018 and 2019, with the first tranche being a $1.15 billion senior secured bank facility due in September next year.

The deal pits the government, which guaranteed the project and has the right to take full ownership of it pending a successful refinancing, against equity owners AMP Capital, Downer EDI and Amber Infrastructure Ltd, and credit wrapper Syncora.

NSW must decide whether it wants to take the now financially successful project back on to its own balance sheet, or leave it in the hands of the existing shareholders. As always, it's about price.

It comes after nearly 18-months of on and off again talks between all of the parties, which have failed to strike a deal. The talks are expected to heat up again in the next three months, with the existing equity owners in particular keen for clarity on the project's future.



Read more: http://www.afr.com/street-talk/reliance-rail-refi-back-on-the-agenda-nsw-takes-pitches-20170611-gwp4kw#ixzz4jtS6Rqh7
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