Spanish export credit insurance agency Cesce and six financial institutions have granted Siemens Gamesa a guarantee facility of more than €1bn so the turbine manufacturer can fulfil its €40bn order book.
The company will use the €1.2bn to support its clients with the usual required technical guarantees, said the Spanish agency.
BBVA and BNP Paribas acted as structuring banks and Caixabank, Crédit Agricole, KutxaBank, and Santander completed the banking syndicate.
The facility is supported by Cesce for 50% of the bank guarantees issued up to a maximum limit of €600m.
The agency’s coverage is provided on behalf of the state, with assistance from the Internationalization Risk Reserve Fund, which is part of the Spanish Ministry of Economy, Trade and Enterprise.
Siemens Gamesa has no payment defaults and the facility is guaranteed by Siemens Energy, so this transaction should not result in any costs to for the public treasury, said Cesce.
The line will be revolving, allowing new guarantees to be issued up to a maximum limit of €1.2bn as existing guarantees are released.
The guarantees will be of a technical nature, i.e., those required to tender, contract, execute, and guarantee Siemens Gamesa’s wind power projects.
This line of guarantees complements the guarantee lines agreed on in Germany with Siemens Energy, parent company of Siemens Gamesa, for a total amount of €11bn.
The maintenance of industrial capacity in the European Union, and in Spain in particular, is an essential factor that has always been a priority for the parties involved, added Cesce.
“They also agree on the importance of renewable energies for promoting both sustainability and energy independence in the countries where Siemens Gamesa’s projects are conducted,” said the agency.
It added: “This is how Siemens Energy is increasing its portfolio of guarantee facilities that support the execution of the wind power business’s large order book of €40bn.
“These long-term projects require a very high investment from customers, and so bank guarantees are needed to cover the execution of the project over a period of several years. In other words, the guarantees are a financial backing that ensures the viability of the project. This practice is common in the energy business.”
The facility can only be used to provide wind power supply and maintenance contracts. This qualifies as “green” within the criteria of the prestigious “Lenders’ Market Association,” which provides this classification to projects that not only reduce CO2 emissions but also comply with strict environmental criteria.