Plenary delivers value uplift in $400m VCCC refinance

MELBOURNE, AUSTRALIA – Plenary has completed a $400 million refinancing of the Victorian Comprehensive Cancer Centre (VCCC).

It comprises a single, six-and-a-half-year senior debt tranche to fully refinance existing debt, eliminating refinancing risk for the remainder of the project’s operations through to 2041 and maintaining the project’s S&P investment grade A rating. Leading domestic and international banks ANZ, CommBank and Intesa Sanpaolo participated.

The highly competitive market leading pricing and terms achieved highlight the value Plenary can provide to investors and governments on state-significant infrastructure.

Fellow project investors UniSuper and Caisse de dépôt et placement du Québec (CDPQ) noted the strong result.

UniSuper’s Head of Property and Infrastructure Kent Robbins said, “The successful refinancing of the VCCC is a great outcome for all stakeholders involved, including our key client, the Victorian Government. The VCCC is a valued asset to us, our members and the community it serves, so we’re pleased this transaction has removed any future refinancing risk.”

“As an investor from the outset in the VCCC, CDPQ is delighted of this refinancing achieved thanks to Plenary’s leadership. By leveraging the funding structure Plenary put in place in 2016, this important centre of excellence has managed to eliminate all refinancing risks, while continuing to generate great value and contributing to advance cancer treatment,” said CDPQ Managing Director – Australia and New Zealand Jean-Etienne Leroux.

Transaction lead, Plenary Executive Director, Origination Michelle Sichlau said, “The scope of this refinance was much broader than is typical of a refinance advisory mandate, with a number of additional value-adds to maximise outcomes to investors. This included intensive analysis of several different structuring options, testing different lending markets, and managing existing swap holders and US Private Placement lenders. Our intimate knowledge of the project, having been involved since its inception, combined with leveraging the existing debt framework implemented in 2016 helped us achieve this strong outcome for investors and government alike.”

In 2016 Plenary completed a $450 million long-term bond issue for the VCCC, the first for a public-private partnership in Australia since the Global Financial Crisis, reopening the bond market and competition for debt financing.

The refinance adds to Plenary’s experience in arranging private finance for public infrastructure that has included recent refinances for the Australian Defence Force Single LEAP 2 ($100m), Toowoomba Bypass ($400m), Centre for AgriBioscience ($230m), and Peninsula Link ($646m) projects.

About the Victorian Comprehensive Cancer Centre

The VCCC is one of Australia’s leading centres of excellence for cancer treatment, care, research and education. Opened in 2016, the 130,000sqm centre is home to Australia’s only public health service solely dedicated to caring for people affected by cancer, Peter MacCallum Cancer Centre, researchers from University of Melbourne and Melbourne Health, and other specialist health organisations. In 2011 the Victorian Government contracted the Plenary Health consortium – Plenary as sponsor, investor and financial arranger; the Grocon PCL joint venture as builder; and Honeywell as services contractor – to finance, design, build, and maintain the centre for 25 years under a public-private partnership.