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Title: Guidelines for Implementing Asset Recycling Transactions (Download PDF version) - Now Available!

Language: English

Type: Other Publications

Nature: Guidelines

Published: June 30, 2023

Region: Global

Country: Global / Non-Specific

Topic: Asset Recycling *

Keywords: PPPs by Topic *, Asset Recycling **, Concession

Document(s):

Document Summary:

This set of Asset Recycling Guidelines have been developed to support governments in selecting, preparing, and delivering asset recycling transactions, with a focus on long-term concession and lease models only. The Guidelines have been drafted to provide a systematic and consistent approach to facilitate asset recycling transactions under these models.  

The Guidelines have not been prepared with any specific transaction in mind and are meant to serve only as general guidance.  It is therefore critical that the Guidelines be reviewed and adapted for specific transactions. 

Document Details:

This document provides a set of step-by-step guidelines (the Guidelines) for relevant authorities to monetize existing assets by recycling them through long-term concession or lease arrangements. The development of the Guidelines has been informed by best practices gleaned from programs implemented by various countries.  

The Guidelines are structured as follows: 

  • Section 3 sets out the Asset Selection Process which a Relevant Authority should undertake in the selection of an appropriate asset for the purposes of an asset recycling transaction. 

  • Section 4 sets out the Project Preparation Process, which includes the selection of transaction advisors, the due diligence process, project structuring and market sounding activities. 

  • Section 5 sets out the Tendering Process for the asset recycling transaction, from procurement to bid award and contract finalization. 

  • Section 6 sets out financing options and instruments available for asset recycling transactions. 

  • Section 7 sets out the Contract Management process post contract award; this includes guidelines for developing the contract management plan, monitoring and reporting, and dispute resolution mechanism. 

  • Section 8 sets out mechanisms for the use of proceeds raised from an asset recycling transaction based on international best practices. 

 The Guidelines are also supplemented with following Annex: 

  • Module 1 to 4 set out sector-specific asset recycling guidelines for airports, power, roads, and ports sectors, including sector-specific due diligence requirements, sample risk allocation matrix and sample terms of reference (TOR) for selection of transaction advisors.  

  • Module 5 sets out a template for term sheet for a typical concession/ lease model for an asset recycling transaction.  

  • Module 6 sets out the range of bid parameters for a typical concession/ lease model for an asset recycling transaction.  

  • Module 7 sets out the bundling and unbundling criteria for assets considered for asset recycling transaction.  

  • Module 8 sets out the details of climate finance as a financing option for asset recycling transactions. 

  • Module 9 sets out the details of Islamic finance as a financing option for asset recycling transactions. 

  • Module 10 sets out the governance requirements of a project company (JV) for asset recycling transaction. 

Image by Ashi Evaristo

Note/s:

The Guidelines have not been prepared with any specific transaction in mind and are meant to serve only as general guidance. It is therefore critical that the Guidelines be reviewed and adapted for specific transactions To find more, visit the Guidelines to Implementing Asset Recycling Transactions Section Overview and Content Outline, or Download the Full Report.

 

 

Tracking Number: Asset_Recycling_Guidelines_Final_250723_EN

Updated:

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