Sygnus Capital Limited recently acted as lead arranger of a private-public partnership with the Bahamas Striping Group of Companies (BSGC) subsidiary, Caribbean Pavement Solutions, for Sygnus Credit Investments Ltd (SCI) to fund up to US$25 million by way of alternative financing, for the 45-mile highway road improvement project slated for Exuma in The Bahamas.
This is not Sygnus’ first foray into the Bahamian market as the firm served as lead arranger of a private-public partnership (PPP) between the Bahamian government and PPP Investment and Construction Company Limited (PPPICCL) to raise US$9 million earlier this year to rebuild the Eight Mile Rock West End government complex.
Gregory Samuels, Senior Vice President & Head of Investment Banking at Sygnus shared, “We are very pleased to have partnered with the Bahamas Striping Group and its subsidiary Caribbean Pavement Solutions on this very important Public Private Partnership (P3) project for the Government of Bahamas. This transaction further demonstrates our footprint as a bona fide Caribbean Alternative Investment firm and our ability to use creative and innovative structures to solve complex financing issues.”
The scope of work for this project encompasses verge cleaning, street signage, guard rail installations and sidewalks.
It is expected to drive the island forward with updates to seawalls and the installation of new drainage wells to reduce flooding and water settling on the roadway, allowing the infrastructure to have a longer service life.
The project is slated for completion in 2024. The site preparation, infrastructure and construction is expected to generate up to 100 jobs.
“This transaction was structured as an esoteric future flow securitization instrument, with a project finance overlay to mitigate against the usual risks associated with infrastructure and construction projects. In addition, it allows for flexible drawdown and prudent cash flow management supported by a robust collateral package including the pledging of contracts and the assignments of payments under the P3 arrangement,” added Samuels.
CEO of Sygnus, Berisford Grey.
According to President and CEO of Sygnus, Berisford Grey, the company not only evaluated Caribbean Pavement Solutions’ ability to pay its debts, but it also assessed the company’s corporate values.
“The key thing for us starts with the company and the individuals. We invest and provide credit to individuals and corporations that are run by very strong businesspeople, with strong governance and a strong reputation. Caribbean Pavement Solutions and its team fit this profile perfectly,” he shared.
Like every other lender, Sygnus looked at collateral and the capacity of the company to execute projects, their business strategy and support.
Grey added, “We want to do business with companies that think about the relationship with us as a long-term partnership. That allows us to sit together and find customized solutions. This is exactly the type of partnership we have built with Caribbean Pavement Solutions.”
The Exuma road improvement project marks the first time BSGC has sought outside capital to complete a major public sector project. “This 45-mile highway improvement and infrastructural project will not only modernize the island’s main thoroughfares but also address safety issues and enhance the local economy,” shared BSGC’s Executive Chairman Dominic Sturrup.