Project Finance in Theory and Practice
Designing, Structuring, and Financing Private and Public Projects
- 4th Edition - May 24, 2023
- Imprint: Academic Press
- Author: Stefano Gatti
- Language: English
- Paperback ISBN:9 7 8 - 0 - 3 2 3 - 9 8 3 6 0 - 0
- eBook ISBN:9 7 8 - 0 - 3 2 3 - 9 8 3 7 3 - 0
Project Finance in Theory and Practice: Designing, Structuring, and Financing Private and Public Projects, Fourth Edition provides essential, core coverage of project finance,… Read more
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Request a sales quoteProject Finance in Theory and Practice: Designing, Structuring, and Financing Private and Public Projects, Fourth Edition provides essential, core coverage of project finance, offering new insights into Sharia-compliant instruments and a comprehensive overview of the current state of international regulation of banking post financial crisis. This updated edition includes new case studies and topics related to country risk, along with insights from project finance experts who share their specialized knowledge on legal issues and the role of advisors in project finance details.
The book will be useful for readers at all levels of education and experience who want to learn how to succeed in project finance.
- Features useful, illustrative case studies
- Addresses human rights and sustainability issues, in particular the Equator Principles for determining, assessing and managing environmental and social risk in projects
- Explores treatment of guarantee mechanisms that governments are increasingly providing to private developers to attract private capital
Upper-level undergraduates and graduate students in project finance
- Cover image
- Title page
- Table of Contents
- Copyright
- Preface to the Fourth Edition
- Preface to the Third Edition
- Preface to the Second Edition
- Preface to the First Edition
- Foreword by William L. Megginson
- Foreword by Lilyana Pavlova
- Foreword by Alain Rauscher and Mark Crosbie
- Foreword by Dario Scannapieco
- About the Author and the Contributors
- 1. Introduction to the Theory and Practice of Project Finance
- Introduction
- 1.1 What Is Project Finance?
- 1.2 Why Do Sponsors Use Project Finance?
- 1.3 Who Are the Sponsors of a Project Finance Deal?
- 1.4 Overview of the Features of Project Finance
- 1.5 The Theory of Project Finance
- 2. The Market for Project Finance: Applications and Sectors
- Introduction
- 2.1 Historical Evolution of Project Finance and Market Segments
- 2.2 The Global Project Finance Market
- 2.3 The Evolution of the PPP Market
- 3. Project Characteristics, Risk Analysis, and Risk Management
- Introduction
- 3.1. Identifying Project Risks
- 3.2. Risk Allocation With Contracts Stipulated by the SPV
- 3.3. Summary of the Risk Management Process
- 4. The Role of Advisors in Project Finance Deals
- Introduction
- 4.1 The Role of Legal Advisors in Project Finance Deals
- 4.2 The Role of the Independent Engineer in Project Finance Deals
- 4.3 Role of Insurance Advisors and Insurance Companies in Project Finance Deals
- 5. Valuing the Project and Project Cash Flow Analysis
- Introduction
- 5.1. Analysis of Operating Cash Flows and Their Behavior in Different Project Life-Cycle Phases
- 5.2. Defining the Optimal Capital Structure for the Deal
- 5.3. Cover Ratios
- 5.4. Sensitivity Analysis and Scenario Analysis
- 6. Financing the Deal
- Introduction
- 6.1. Advisory and Arranging Activities for Project Finance Funding
- 6.2. Other Roles in Syndicated Loans
- 6.3. Fee Structure
- 6.4. International Financial Institutions and Multilateral Banks
- 6.5. Bilateral Agencies: Developmental Agencies and Export Credit Agencies (ECAs)
- 6.6. Other Financial Intermediaries Involved in Project Finance
- 6.7. Funding Options: Equity
- 6.8. Funding Options: Mezzanine Financing and Subordinated Debt
- 6.9. Funding Options: Senior Debt
- 6.10. Project Leasing
- 6.11. Project Bonds
- 6.12. Islamic Finance for Infrastructure Financing
- 7. Legal Aspects of Project Finance
- Introduction
- 7.1 The Project Company
- 7.2 The Contract Structure
- 7.3 Project Finance Bonds
- 7.4 Refinancing Project Finance Deals
- 8. Credit Risk in Project Finance Transactions∗
- Introduction
- 8.1. The Basel Committee’s Position on Structured Finance Transactions (SL)
- 8.2. Rating Criteria for SL and Their Application to Project Finance
- 8.3. The Basel Accord and the Treatment of Credit Risk for Project Finance Loans: Is Project Finance More Risky Than Corporate Loans?
- 8.4. Empirical Studies on Project Finance Defaults and Recovery Rates
- 8.5. Introduction to the Concepts of Expected Loss, Unexpected Loss, and Value at Risk
- 8.6. Defining Default for Project Finance Deals
- 8.7. Modeling the Project Cash Flows
- 8.8. Estimating Value at Risk Through Simulations
- 8.9. Defining Project Value in the Event of Default
- Case Study 1. Cogeneration 1
- Case Study 2. Italy Water System
- Case Study 3. Odebrecht Drilling Norbe VIII/IX: Project Bonds as a Refinancing Tool in Project Finance
- Case Study 4. Watercraft Capital S.A.: Refinancing Project Finance Transactions
- Case Study 5. Viveracqua Hydrobond: When Infrastructure Investments Meet Securitization
- Case Study 6. Quezon Power Ltd. Co. Project Finance. The Impact of Risk Management on the Cost of Funding
- Case Study 7. Murcia Solar Power Plant
- Appendix. The Structure and Functioning of the Simulation Model
- Glossary and Abbreviations
- References
- Index
- Edition: 4
- Published: May 24, 2023
- Imprint: Academic Press
- No. of pages: 600
- Language: English
- Paperback ISBN: 9780323983600
- eBook ISBN: 9780323983730
SG
Stefano Gatti
Stefano Gatti is the Antin Infrastructure Partners Chair Professor of Infrastructure Finance and Professor of Practice in Finance. He is the Director of the Full Time MBA and former Director of the International Teachers’ Programme at SDA Bocconi School of Management. His main area of research is corporate finance and investment banking. He has published in these areas including publications in the Journal of Money, credit and banking, Financial Management, the Journal of Applied Corporate Finance and the European Journal of Operational Research. Professor Gatti has published a variety of texts on banking and finance areas and has acted as a consultant to several financial and non-financial institutions and for the Italian Ministry of the Economy, the Financial Stability Board, The InterAmerican Development Bank, the Asian Development Bank and the OECD/Group of G20. He is financial advisor of the Pension Fund of Health care professions, member of the compliance risk committee of Deutsche Bank and member of the Board of Directors and board of auditors of Italian industrial and financial corporations.
Affiliations and expertise
Professor, Bocconi University, Milan, Italy and consultant for banks and manufacturing firms in Italy and a trainer for managers and government members in Russia, Africa and ChinaRead Project Finance in Theory and Practice on ScienceDirect