The largest-ever financing deal in the mining sector has been finalised, after an agreement was reached for Gina Rinehart’s Roy Hill iron-ore project.
The Roy Hill mine, located in Western Australia’s Pilbara region, can proceed now that 19 commercial banks and five export credit agencies have come up with $7.9 billion for the mine, railway and port project.
Allen & Overy acted as Australian and international counsel to the export credit agencies and commercial lenders on the financing of the project.
Australian partners Adam Stapledon and Chris Rushton led the Allen & Overy team, along with partner-elect David Christensen.
Allen & Overy was also required to engage partners in the firm’s Tokyo, New York, Washington D.C. and Singapore offices as part of the deal.
Herbert Smith Freehills, led by banking and finance partner David Walton, advised Roy Hill on Australian law matters.
Herbert Smith Freehills also advised the consortium made up of Marubeni Corporation, POSCO and China Steel Corporation which owns 30% of Roy Hill.
Gine Rinehart's Hancock Prospecting controls a 70% majority stake in Roy Hill.
The Herbert Smith Freehills team advising the consortium was led by partners Shane Kyriakou, Martin MacDonald and Belinda Fan.
Latham & Watkins, with Singapore partners Andrew Roche and Stephen McWilliams at the helm, also acted for Roy Hill as international counsel.
"Our ability to mobilise high performing teams in each of the home jurisdictions of the key lenders, including in Australia, contributed towards signing the deal in a much shorter timeframe than is the case for similar transactions," Allen & Overy partner Stapledon said.
"The structuring and risk allocation of the deal were complex and it was one of the first megaprojects to be financed without a full completion guarantee from sponsors,” Stapledon added.
The project is currently one of the world’s largest mining developments and is expected to produce, at low cost, 55 million tonnes of ore per annum.
