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Project Financing

Учебный год
Обучение ведется на английском языке
Курс по выбору
Когда читается:
2-й курс, 1, 2 модуль

Course Syllabus


The course focuses on how private investors are taking decisions about investing in large infrastructure projects from the standpoint of equity, debt, and hybrid instruments. The course concentrates on the practical aspects of project finance: the most frequently used financial techniques for infrastructure investments. In the end of the course, students will be capable of analyzing a complex transaction, identifying the key elements of a deal, and suggesting proper solutions for deal structuring from a financial advisor's perspective.
Learning Objectives

Learning Objectives

  • To be able to find the optimal financial structure for funding large infrastructure projects
  • To recognize, value and mitigate risks of project financing
  • To develop a financial model for a large infrastructure projects
Expected Learning Outcomes

Expected Learning Outcomes

  • To be able to assess risks and to propose actions for risks mitigation
  • To be able to calculate the fees that each bank or industrial partner receives
  • To be able to calculate the total fee (contract price) for the customer
  • To be able to develop a capital budget for a project
  • To be able to forecast and calculate project cash flows for its shareholders
  • To be able to prove a project sustainability
  • To be able to recognize and map risks common to PF
  • To be able to use different types of loan amortization and to compare them
  • To identify different types of contracts and the parties involved in the PF
  • To know different types of syndication strategies
  • To know how real options may be used for maximizing the value of a risky project in PF
  • To know how to app;y different types of covenants
  • To know the specifics of Project Finance
  • To learn how lendera can protect themselves by using loan agreements
  • To understand the role of Project Finance in liquidation of inequalities
Course Contents

Course Contents

  • Introduction to Project Finance
  • The process of Syndication
  • Risk analysis and distribution of risks in Project Finance
  • Financial Model of a Project
  • Loan Agreements, Structuring and Lenders Protection
Assessment Elements

Assessment Elements

  • non-blocking Class activity
  • non-blocking Case analysis
    A group case on developing the financial model for a PF project and its presentation to a class
  • Partially blocks (final) grade/grade calculation Examination test (70 minutes + 10 minutes for reading and preparation), closed-book.
Interim Assessment

Interim Assessment

  • 2021/2022 2nd module
    0.4 * Examination test (70 minutes + 10 minutes for reading and preparation), closed-book. + 0.3 * Case analysis + 0.3 * Class activity


Recommended Core Bibliography

  • Frederik Pretorius, Berry-Fong Chung-Hsu, Arthur McInnes, Paul Lejot, & Douglas Arner. (2008). Project Finance for Construction and Infrastructure : Principles and Case Studies. Wiley-Blackwell.
  • Friedl, G., Copeland, T., & Antikarov, V. (2018). Real Options. A Practitioner´s Guide, Book Review. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsbas&AN=edsbas.5BD264EB
  • Paul D. Clifford. (2021). Project Finance : Applications and Insights to Emerging Markets Infrastructure. Wiley.
  • Project financing and the international financial markets, Buljevich, E. C., 2002

Recommended Additional Bibliography

  • Childs, P. D., Ott, S. H., & Triantis, A. J. (1998). Capital Budgeting for Interrelated Projects: A Real Options Approach. Journal of Financial and Quantitative Analysis, (03), 305. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsrep&AN=edsrep.a.cup.jfinqa.v33y1998i03p305.334.00
  • Guo, J., Huang, P., & Zhang, Y. (2019). Do debt covenant violations serve as a risk factor of ineffective internal control? Review of Quantitative Finance & Accounting, 52(1), 231–251. https://doi.org/10.1007/s11156-018-0708-7
  • Laux, J. (2011). Topics in Finance Part VI——Capital Budgeting. American Journal of Business Education, 4(7), 29–38. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=eric&AN=EJ1056593
  • Lev Virine, & Michael Trumper. (2017). Project Risk Analysis Made Ridiculously Simple. World Scientific Publishing Co. Pte. Ltd. https://doi.org/10.1142/9963
  • Link About It: Information Asymmetry, Knowledge Pooling and Syndication in Project Finance Lending. (2018). https://doi.org/10.26481/umagsb.2018008
  • Ruling Zhang, Killian J. McCarthy, Xiao Wang, & Zengrui Tian. (2021). How Does Network Structure Impact Follow-On Financing through Syndication? Evidence from the Renewable Energy Industry. Sustainability, 7, 1.