4 november 2021 Energy and Infrastructure - Environment and Climate Change - Project Finance - Renewables

Linklaters advises on the financing of the Greater Changhua 1 Offshore Wind Farm in Taiwan

  • The first “holdco” financing structure deployed in the offshore wind sector outside of Europe
  • CDPQ’s first direct investment in Taiwan through its infrastructure team and its first investment in Asia Pacific’s offshore wind market
  • The first time Export Development Canada (EDC) has participated in Taiwan’s offshore wind market

Linklaters advised the lenders, hedge banks and export credit agencies (ECAs) on the approx. US$3bn holdco financing of the 605MW Greater Changhua 1 Offshore Wind Farm, situated 35-50 kilometres off the coast of Changhua County in Taiwan. Holdco financings, a specialist financing structure at holding company level, are often seen in the European offshore wind market. This transaction marks the first time it has been deployed in the Asia offshore wind market.

Ørsted, a leading Danish multinational power company, is the developer of the project and will retain a 50% stake in the offshore wind farm, while Canadian institutional investor Caisse de dépôt et placement du Québec alongside established local investor Cathay Private Equity, will acquire the remaining 50%.

The financing group comprised 15 international and Taiwanese commercial banks, five ECAs from Canada (EDC), Denmark (EKF), Korea (K-SURE), the Netherlands (Atradius) and the UK (UK Export Finance), as well as two Taiwanese life insurance companies. This marks the transaction as drawing funding from one of the widest sources seen in the Asian offshore wind market.

Linklaters’ involvement in the transaction consolidates the firm’s leading position in the Asia offshore wind market. The firm has been involved on either the borrower or lender side of all five Taiwan offshore wind transactions which have achieved financial close to date, as well as a number of M&A roles. The firm is also active in other new markets in Asia which are developing offshore wind projects, including Japan, South Korea and Vietnam.

The team was led by energy & infrastructure partner James McLaren (Hong Kong SAR) and counsel Ying Fu (Hong Kong SAR) who were supported by an associate team including Albert Yu (Managing Associate, London), Tristan Kelly (Managing Associate, Singapore), Isabella Peplinski (Managing Associate, London), Suzy Su (Associate, Hong Kong SAR) and Derek Loh (Associate, Hong Kong SAR). Additional support was provided by Richard Ginks (Partner, London), Joo Hee Lee (Partner, Seoul) and Richard Coar (Partner, London) together with Linklaters’ market-leading construction, environment, and structured financing teams.

Partner and Head of Linklaters’ Asia Green Energy Group James McLaren, commented:

“Linklaters has been involved in some of the most transformational offshore wind projects in Asia and has a strong track record in Taiwan, leveraging expertise from across our global network and building on our work from previous offshore wind financings. We are grateful to our clients and the sponsors for the trust they placed in us on this important transaction.”

Counsel Ying Fu, added:

“This landmark transaction is a great example of the evolution of the offshore wind sector in Asia, and demonstrates Linklaters’ market leading position in the green energy space. We are honoured to have had the opportunity to support the financing parties on this deal - particularly given its first-in market nature - and to continue to contribute to the development of the offshore wind industry in Taiwan and the wider Asian market.”