A European syndicate has provided €1.4bn for Butendiek offshore wind farm, Germany.

All but €450mn is debt financing. GTR can confirm that the European Investment Bank (EIB) has provided €450mn in two tranches. The first tranche of €300mn is covered by Danish export credit agency EKF, while the second tranche of €150mn is an uncovered senior loan.

KfW has contributed €200mn to the deal while the other €300mn comes from a pool of commercial banks, with an average ticket size of €30mn. The commercial banks involved are: UniCredit (joint arranger), KfW Ipex (joint arranger), Bremer Landesbank (joint arranger), BayernLB, Helaba Landesbank, Hsh Nordbank, ING, Rabobank and SEB. All of the loans provided by commercial banks are uncovered.

The contractual tenor of the transaction is 11 years, but the built-in cash sweep mechanism (which allows a certain amount of cashflow to be swept in order to repay the loans) means the actual tenor is 8.5 years.

Melchior Karigl, senior project finance specialist at the EIB, tells GTR that the deal was able to attract so much commercial investment due to its “bank-friendly structure”. He explains: “There’s a lot of equity in the deal, we have very conservative ratios so that all makes it attractive. We have a higher level of contingencies compared to other offshore wind farms. We have a feed-in tariff system which begins at the start of the operation. It’s a higher tariff compared to other countries and leads to an actual shorter tenor.”