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Project Finance for Business Development by John E. Triantis

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CHAPTER 1IntroductionWhy Project Finance for Business Development?

The treatment of project finance has primarily been for the infrastructure industry, but the processes and techniques used are also applicable to other off‐balance‐sheet financings of separate entities, joint ventures, and projects in other industries. Project finance has traditionally been treated from a financial engineering or from a contract finance perspective with applications in infrastructure projects in underdeveloped or developing countries lacking sufficient public and private resources to fund needed projects. Projects of such characteristics are the most challenging and once experience is obtained from such projects, it is easily transferable to projects in other industries and developed countries.

The globalization of business has intensified competition among project sponsors/developers, construction contractors, technology and equipment providers, and some funding sources. The result is coopetition in project development and financing that has increased the need for effective project finance solutions and better‐structured partnerships and joint ventures. In this environment, to win large project bids, sponsors need an overall competitive advantage. To create profitable investment projects, they need a disciplined, new business development approach to project finance.

Project finance is not a stand‐alone function based on contract finance or legal engineering as it is being treated in the current ...

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