Two recent offerings highlight the huge investor demand for high-quality infrastructure bonds.
GreenSaif Pipelines BidCo, a BlackRock-owned entity that holds a stake in a subsidiary of Saudi Aramco, issued US$1.4 billion notes due 2036 and US$1.6 billion notes due 2042.
Milbank advised the dealers on the two offerings, which were issued under GreenSaif’s US$11.5 billion global medium-term note programme.
There was a huge demand for the bonds, which were launched on July 18 and admitted for trading on the London Stock Exchange on July 31.
Global coordinators and joint bookrunners were J.P. Morgan and Standard Chartered Bank. BofA Securities, Mizuho, Citigroup, Crédit Agricole CIB and Société Générale were joint bookrunners.
Joint passive bookrunners were Abu Dhabi Commercial Bank, HSBC, BNP Paribas, MUFG, First Abu Dhabi Bank and SMBC Nikko. Co‑managers were ABC International, Natixis, Bank of China, China Construction Bank, and Riyad Capital.
Proceeds from the issuances were used to refinance a bridge facility, which was entered into in connection with GreenSaif’s acquisition of a minority stake in Aramco Gas Pipelines Company, a subsidiary of Saudi Aramco.
GreenSaif acquired a 49% stake in Aramco Gas Pipelines Company in 2022 and has rights to 20 years of tariff payments for natural gas transported through Saudi Aramco’s domestic natural gas pipeline network.
Airport project financing
Meanwhile, there was also a huge demand for the US$2.55 billion offering for The JFK New Terminal One, the largest-ever municipal bond financing for an airport project.
BofA Securities and Loop Capital Markets acted as joint bookrunners, with Barclays acting as co-senior manager. The bonds were designated as green bonds by Kestrel Verifiers, an independent second-party opinion provider that confirmed the uses of the bonds conform with the Green Bond Principles.
Proceeds from the 2024 Series bonds will be primarily used to finance and refinance a portion of the costs of constructing the initial phase of The New Terminal One development, a portion of which were initially funded with a bank facility in June 2022.
The Series 2024 Special Facilities Revenue Bonds were initially marketed at US$1.5 billion. But due to strong investor demand during the pre-marketing stage and the order period itself, the issuance was upsized to US$2.55 billion.
The New Terminal One is a key component of the Port Authority of New York and New Jersey’s US$19 billion transformation of JFK Airport, with two new terminals, two expanded and modernized terminals, a new ground transportation centre, and an entirely new, simplified roadway network.
Scheduled to open in 2026, The New Terminal One is backed by a consortium of financial, operating, and labour partners, including Ferrovial, JLC Infrastructure, Ullico and Carlyle.
“Our continued success in refinancing through this landmark bond issuance demonstrates the confidence of the capital markets in The New Terminal One and our progress in delivering a new gateway for New York and our nation,” says The New Terminal One chief executive officer Jennifer Aument.
“This refinancing re-affirms our commitment to maintaining The New Terminal One’s position of financial strength, as we gather momentum towards our scheduled opening in 2026.”
The New York Transportation Development Corporation acted as conduit issuer of the Series 2024 bonds on behalf of The New Terminal One. Ramirez & Co. served as New Terminal One’s municipal and pricing advisor. Assured Guaranty provided insurance on US$800 million of the bonds.