Corporacion Andina de Fomento is
preparing a collateralized debt vehicle to fund Colombian road
construction, a first for Latin America and one that could be
replicated in other countries and industries.
By contributing an equity portion and
bringing in senior investors, CAF could leverage a small
investment to fund a broad range of projects.
CAF expects to spend the next three
months finalizing the structure of the transaction, Victor
Traverso, representative director for the CAF in Colombia, told
From there, it plans to look for other
subordinated investors and mandate an asset manager to run the
vehicle. Colombian road construction concessions will make up
the bulk of the vehicle's investments, but it may buy other
deals - potentially in other investment grade countries - to
build a diversified asset pool.
"If it works right, we will be able to
support a larger number of projects than through funding
individual concessions," Traverso said on the sidelines of the
LatinFinance Securitization and Structured Finance in Latin
America conference in Miami.
For full details of the structure being
planned as well as market reaction, read
CAF Plots Colombia Road Fund