Press Release

White & Case Advises Metro in US$1.3 Billion Financing For New Subway Lines in Chile

Global law firm White & Case LLP represented Empresa de Transporte de Pasajeros Metro S.A. (Metro), the state-owned owner and operator of the subway system in Santiago, Chile, in connection with the US$1.3 billion financing for the construction of new subway lines 3 and 6 and improvements on existing lines.

The financing is a key component in Metro’s approximately US$ 2.8 billion Proyecto 63, which represents the most significant expansion effort since the inauguration of the Santiago subway. Proyecto 63 will add 37 kilometers of track and 28 new stations, nine of which are transfer stations that provide improved connectivity to the existing network. By the time construction is completed in 2018, the ratio of kilometers of track per million residents will jump from 15.0 to 20.4.

"The Santiago subway system is currently one of the best run, most efficient systems in the Americas. Metro's investments aim to incorporate international best practices in order to create a world-class subway system in Chile," says White & Case partner Carlos Viana, who led the Firm’s team of lawyers working on the multisource financing.

In addition to construction of the new lines, the financing will pay for improvements in existing lines 1, 2 and 5, including the installation of elevators to improve accessibility at stations, the addition of 126 cars which will increase the passenger capacity of these lines and the modernization of existing rolling stock.

The new lines, which will be underground to minimize disruption of city activities and environmental impact, are expected to benefit 11 communities, including five new communities that will be connected to the Santiago subway once the new lines become operational.

"The new lines and the modernization program have been designed to achieve the highest potential socio-economic returns, including reductions in fuel consumption and in travel times for commuters,” says White & Case associate Jeannine Acevedo, who worked with Viana on the multisource financing.

The US$1.3 billion financing was extended in two stages. The Firm represented Metro in connection with its issuance of US$500 million aggregate principal amount of 4.750% notes due 2024, through a Rule 144A/Regulation S issuance. The issuance of the notes, which were listed on the Luxembourg Stock Exchange, was the first 144A/Regulation S offering to date by Metro.

The Firm also represented Metro in the US$800 million commercial loan and ECA-insured facilities for financing the procurement, purchase, installation, testing and commissioning of the equipment and systems, including rolling stock, for the new and existing subway lines. This multisource financing is being led by Sumitomo Mitsui Banking Corporation and BNP Paribas S.A., with backing by CESCE and COFACE, the Spanish and French export credit agencies.

In addition to Viana and Acevedo, the White & Case team that advised on the financing included partners John Vetterli, Ray Simon, Daniel Nam, Richard Burke, counsel Tallat Hussain and associates Bibiana Jaimes, Lucy Haley, Elizabeth Gonzalez and Nicolas Endre.

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