CEE & Central West Asia: Best Bank for Infrastructure/Project Finance 2017
In 2005, nine Shanghai-based state-owned enterprises set up a project company to develop a large-scale residential and commercial complex in St Petersburg. Since then, Shanghai Overseas United Investment Holdings (SOUI) has invested more than $1.3 billion in the Baltic Pearl development, making it the largest non-energy investment by Chinese companies in Russia.
While the majority of financing has been provided by SOUI, for the last phase of the project the company opted to approach the international market.
Deutsche Bank stepped up to the plate. Together with Sinosure, China’s export credit agency, it structured a three-year $95 million credit facility to ZAO Baltic Pearl. Guaranteed by Sinosure, the loan provided overseas subsidiary financing without the need for cross-border parent guarantees for SOUI’s nine shareholder companies.
As the sole structuring bank, Daniel Qian at Deutsche Bank proved adept at coordinating between Chinese public-sector stakeholders including Sinosure, SOUI and its shareholders as well as international banks.
Both the Baltic Pearl project and the latest financing round have been hailed by policymakers in Beijing and Shanghai as a model for Chinese companies looking to invest in Belt and Road projects in Russia and other CEE countries.