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Guidelines for Legal and Commercial Structuring Options
The legal and commercial structuring of a project involves defining the ownership model for project implementation, including allocation of roles and responsibilities, and risks between the Relevant…
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Table of Contents for Asset Recycling
The PPPRC Asset Recycling Section Executive Summary …
- PPPs by Topic
- Asset Recycling
- Asset Identification/Selection
- Project Preparation in Asset Recycling
- Tendering Process in Asset Recycling
- Financing Options and Instruments in Asset Recycling
- Contract Management in Asset Recycling
- Utilization of Proceeds in Asset Recycling
- Bid Parameters
- Climate Finance
- Islamic Finance
- Power
- Sample drafting
- Ports
- Airport
- Toll Roads
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Market Sounding in Asset Recycling
The government should approach the market sounding exercise to assess the following:Project viability: whether the proposed asset put up for recycling is viable (from private sector’s perspective);…
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Multi-asset Procurement (Asset Bundling) in Asset Recycling
Governments considering asset recycling transactions may envisage bundling multiple assets of same asset class as part of a single asset recycling transaction.Key Parameters to Consider for Multi-…
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Commercial Principles in Asset Recycling
The Relevant Authority should determine key commercial principles that will form the basis of the project structure and the project agreement; the commercial principles should ensure value…
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Risk Identification and Allocation in Asset Recycling
The Relevant Authority should identify and allocate risks for the concession or lease arrangement as part of the transaction preparation. The objective is to ensure that specific risks are…
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Ownership Models in Asset Recycling
There are several variations as to how an asset recycling transaction undertaken by way of a concession or lease arrangement can be implemented. In this section, we discuss the following models:…
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Asset Valuation Methodology in Asset Recycling
Valuation of the asset is conducted to estimate and determine the fair value of the upfront fee that a bidder may pay to the Relevant Authority (or any other form of consideration).This is a crucial…
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Environmental and Social Due Diligence in Asset Recycling
The Relevant Authority should be required to disclose environmental requirements (permits, standards, etc.), risks, issues, liabilities, compliance status. Climate risk disclosure can help raise…
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Accounting and Tax Due Diligence in Asset Recycling
Besides the technical, commercial, financial and legal due diligence, other assessment includes accounting and tax due diligence, which should consider the following:Accounting due diligenceIdentify…
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Prescriptive Legal Due Diligence in Asset Recycling
OverviewPrescriptive due diligence outputs are primarily focused on describing the legal aspects of structuring options in relation to the descriptive due diligence outputs.The output of the…
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Descriptive Legal Due Diligence in Asset Recycling
OverviewDescriptive due diligence outputs are focused on describing the current legal aspects relevant to the Relevant Authority and the asset as at the review date. This description is without…
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Review of Legal and Regulatory Context in Asset Recycling
Conducting due diligence with respect to the legal and regulatory context requires a review of the laws, regulations and policies affecting the Relevant Authority and the asset.Areas covered may…
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Legal Due Diligence and Review in Asset Recycling
Legal due diligence in connection with an asset recycling transaction preparation covers the main topics listed below.Review of legal and regulatory context (in relation to the laws, regulations and…
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Financial Due Diligence in Asset Recycling
The financial due diligence should cover the analysis of the asset’s historical and projected financial performance. This will provide the Relevant Authority with an indication of the capital…
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Commercial Due Diligence in Asset Recycling
The coverage of the commercial due diligence process is represented in the diagram below:Figure 2: Commercial Due Diligence Coverage Demand/ Patronage/Traffic Assessment An assessment…
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Technical Due Diligence in Asset Recycling
The objective of the technical due diligence is to identify potential technical issues with respect to the asset. This exercise should form the basis for determining the scope for management,…
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Due Diligence Process in Asset Recycling
table tr th, table tr td { border:1px solid #ffffff; padding:10px } The Relevant Authority should conduct asset due diligence as part of the transaction preparation leading up to the asset…
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Engaging Advisors in Asset Recycling
table tr th, table tr td { border:1px solid #ffffff; padding:10px } Advisory Services for an Asset Recycling ProjectFigure 1: Advisory Services for an Asset Recycling ProjectThe engagement of…
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Project Preparation in Asset Recycling
At the project preparation stage, the Relevant Authority should conduct the following activities:Recruit and engage advisors, including financial, technical, legal, and other advisors (such as,…