Public Private Partnerships
We are currently developing a wide range of products and services to meeting our client's needs in this area and our main focus is on the continent of Africa. We have a number of projects under reviews and placements with our preferred list of investors and fenders. Our specific focus on the PPP for Africa is on Build Operate and Transfer (BOT) and Design Build Finance and Operate (DBFO) models with a combination of government and contractor operated arrangements for delivery of services etc.
There is a combination of financing options available for this type of project however; we will propose the following at commencement of negations:
1 Equity Share
Under this option the facility will be built with private finance comprising of equity and debt. Key investors would be encouraged to participate in the project through government support and provision of seed capital/assets for the development such as land, equity stakes usually 10-50% of the project costs while the private investors will provide the rest of the finance through direct equity participation and or long term loans. Repayment terms for loans are usually between 3-15 years depending on the size and scale of the project and equity holders will normally insist in managing key business operations such as financial management etc.
Joint venture agreement with the government for the construction of the facility within any of the above model with ownership levels pre-determined as either 50% each with the public and private sector investors or a combination of investors formed as a consortium. This could be a Special Purpose Vehicle (SPV) of a multiple of private companies formed to participate in the project. This will involve clarity in the sharing of responsibilities, performance and payment/service delivery mechanism and usually long term contracts of 15-30 years can be agreed at commencement reviewed on annual performance. While the private sector provides the capital funding for the project, the general public and/or the public sector (state or federal government) ultimately pays for the services and creates income generation streams for the project. A strategic partnership board will be established involving all partners separate from the management board to provide strategic directions and management of the facility. This provides for a win-win situation for all concerned
With this option, contracting firms will only work in advisory capacity with the state or federal government for the establishment of the facility and only concentrate on the contractual services for the delivery of the project. Ownership will remain with the public sector and/or the private sector but long term contract for service delivery will be awarded to a named contractor/agency as a preferred provider. Outcome/service specifications will be provided by the public sector/owners of the facility with key performance indicators which will be used to monitor the delivery standards. This process will involve a Service Level Agreement and delivery contract with the provider while the contract management will be separated from service delivery.
Our independent and confidential consultancy services are provided through experienced consultants with first-hand commercial, Public, Private and Voluntary/Charitable Sector experience. Approaching problems solving without preconceptions, we help organisations compete through the evaluation and application of change management, whether organisational, operational, project based, financing, partnership development and/or people development.
RCG has extensive experience of working in partnership with a wide range of organisations from community organisations, small and large companies to academic institutions on a range of assignments and consultancy projects as part of an ongoing programme to strengthen the management, research, innovation, technological and delivery capabilities of SME's and the public, private and voluntary Sectors. All enquiries are given urgent attention and treated in the strictest confidence.