Infrastructure Law Firm of the Year-Latin America: Clifford Chance

HEAD PARTNERS: Gianluca Bacchiocchi, Fabricio Longhin, Jonathan Zonis (Latin America Practice); Anthony Oldfield, (Managing Partner, São Paulo)

Clifford Chance has worked on many of Latin America’s significant infrastructure deals over the past year. These range from Colombia’s Autopista al Mar 1, where it advised such institutions as Sumitomo Mitsui Banking Corp., KfW, Société Generale, and FBN, to Peru’s Internet para Todos, where it advised IDB Invest and CAF. The firm also advised Mizuho for the Lima Metro Line 1 expansion.

But this year’s recognition also highlights the firm’s work in lesser developed markets like Argentina, where it worked with IDB and the country’s Public Private Partnership unit to put together the framework that was used to auction six toll roads and will likely be employed for other roads and social assets, including a possible railway, according to Guido Liniado, a Clifford Chance partner.

This approach is part of an overall “early involvement” strategy, according to partner Fabricio Longhin. Even before Argentina announced its renewable energy program, RenovAr, Clifford Chance was already at work, he says.

“Rather than wait for the regulation to come out, we approached the government and told them we could help,” says Longhin. “We took the step to tell them what has been done. We have experience all over the world on renewable energy.”

In exchange for developing a bankable power purchase agreement structure, the firm wanted to be involved in subsequent transactions, especially given the concerns about the economy and political climate in Argentina. When the government agreed, Clifford Chance worked with the IFC to design a model PPA and associated documentation.

“We closed on around 20 financings and are working on more,” says Longhin. “On the six road concessions that were auctioned, we’re advising the lenders on the six of them.”

The firm is pursuing a similar strategy in other Latin countries, including Colombia and Paraguay.

As for the current landscape, Clifford Chance reports a growing interest from institutional investors, both local and global. Rather than taking a passive role, the firm is building its own infrastructure teams and taking a proactive stance.

“The underlying shift in the market is the really low yields in safe assets in the US and emerged countries,” says partner Catherine McCarthy. “Everybody decided that safer, higher quality infrastructure assets in Latin America are offering an acceptable alternative from a risk perspective that have a much higher yield.”

She adds: “It started with a bit of a trickle. But I’m getting calls from people I would have never expected to hear from. That’s how much this whole group of investors is opening their eyes and looking at Latin project finance as an asset class.”

Whether the deal flow expands with the new demand is another question. While Argentina elections and pension reform in Brazil have lent uncertainty to the market, McCarthy says the bigger concerns are the US-China trade dispute and the possibility of a no-deal Brexit.

“How the market will go depends a lot on these macro trends,” she says.