While Africa’s huge gap in power generation capacity also presents major opportunities for investors in this sector, the financing of such projects poses its own, unique challenges in terms of risk, long-term planning and profit margins. The Spintelligent Training Academy is providing long overdue, specialist training in financial modelling for the power sector to assist utilities (generation and distribution), financiers, banks, investors, insurance companies and large scale developers to get projects off the ground and up and running.
“What we are going through, in my opinion, is not a cyclical change but a structural change” says Malcolm Sullivan, global finance expert and banking pioneer. He explains: “since the beginning of the credit crisis, the financial world has basically changed, where we may be going into a low inflation environment. We have come to a period where there have been sharp changes in energy prices and these are causing people to re-evaluate many things”.
Malcolm Sullivan will facilitate the upcoming “Financing Power Projects in Africa” specialist course in the Kenyan capital, Nairobi from 11-13 July. He says the course will be “case study driven, which will be drawn from projects around the world”.
Major key take-aways of the course will include:
- Why do people use project finance as opposed to corporate finance?
- What are the risks, how do the risks get managed and allocated?
- What is the role of the financial model to assist in understanding where the sensitivities are?
- What is an appropriate capital structure?
- What is risk and return from the banks’ point of view and also from the equity investors’ stand point.
- How to actually glue the transaction together.
Opportunities in West Africa
Nigeria is a leading energy powerhouse on the continent, with the liberalisation of the sector already underway. The well-known Nigerian finance expert, Dr. Simon Akinteye, will present the “Effective Financial Modelling” course with a specialised focus on the West African challenges in Lagos from 21-23 September.
Says Dr Akinteye: “most of the Discos (Power Distribution Companies) are currently inviting the investing public, both local and international, to submit their RFP (Request for Proposal) for power generation. Herein lies another challenge: the preparation of the financial modelling for a financial tender, including financial modelling of the tariff and other components of the tender over the lifespan of the power plant”.
As in Nairobi, Dr Akinteye also promises a very relevant, practical course: “the training is full of case studies, scenario modelling, group exercises and assignments. All participants are required to attend this course with their laptop and be ready for very stimulating but intensive sessions. It offers participants comprehensive, hands-on skills and expertise in financial modelling, which is key knowledge for everyone involved in the finance related roles within and outside the power sector, particularly bankers, insurers, consultants and other practitioners in the sector”.
He adds: “this course is a must-attend for all those having finance related functions within the Power Sector, either within the Discos, Gencos and the O&M corporations. This course will feature, among other, important modules including revenue modelling, expenditure modelling, modelling WACC, cash flow modelling, statement of comprehensive income modelling, balance sheet modelling and modelling the financials for a comprehensive RFP.”
Upcoming courses in Financing Power Projects and Effective Financial Modelling in Africa:
– Kenya, Nairobi, 11-13 July
– Nigeria, Lagos, 21-23 September
About the Spintelligent Training Academy
The Spintelligent Training Academy has been empowering individuals, teams and organisations to reach their goals through knowledge, understanding and innovation since its inception. It is part of Spintelligent, a leading Cape Town-based trade exhibition and conference organiser and the African office of Clarion Events Ltd, based in the UK. Spintelligent hosts major events in the energy, infrastructure, mining, agriculture, education and real estate sectors across the African continent. Its long-running flagship events include African Utility Week in Cape Town, the East African Power Industry Convention (EAPIC) in Nairobi and the West African Power Industry Convention (WAPIC) in Lagos.
For more information about the Spintelligent Training Academy and its courses, contact:
Marketing manager: Lucian Sackim
Tel. +27 21 700 3571