Proparco to take part of FMO led syndicate to provide ECB of USD 70 million to SREI
Asset finance Company Srei Infrastructure Finance Ltd, India leading private sector infrastructure financing institution has entered into an agreement to raise 70 M$ senior loan syndicated by the Nederlands based FMO, one of the world’s largest bilateral private sector development banks. Proparco, the private sector investment arm of Agence Française de Développement (AFD), the leading French development finance agency, will take part of the loan through a 20 M$ funding dedicated to renewable energies and energy efficiency.
Due to the recent global financial crisis and limited channel of credit, project developers in the infrastructure sector have been adversely affected; the worst hit are small and medium size companies who depend on Non Banking Financial Companies (NBFCs) like Srei for their funding requirement. The government of India has set up a fiscal and monetary stimulus package with a focus on infrastructure creation. In this framework, a special refinance window has been opened allowing Infrastructure NBFCs like Srei to raise External Commercial Borrowings.
This syndicated loan will be used for funding infrastructure projects directly and also for leasing of infrastructure equipment. It will ensure that long term funds are available so that Srei can continue lending.
Proparco funding is in line with the strategy of the AFD Group in India focusing on promoting renewable energies. Srei has a long track record of investment and innovation in this sector.