Bidders may decide to run a competitive process for the selection of lenders prior to ITN/IPD bid submission in order to produce a variant bid with:
6.2.1 the financing sources (for bank and/or bond) selected and with indicative but uncommitted funding terms supported by letters of support and term sheets. The lenders in this bid accept that they may be subject to further competition if they achieve selection as the PB and the Authority exercises its requirement to run a PBDFC. In this circumstance it should not be assumed by the lenders that they would be given an automatic right-to-match; or
6.2.2 with selected lenders willing to offer agreed terms and cap elements of the debt terms including maximum risk margin and fees. Under this route the variant bid will be evaluated on the capped financing terms. The subsequent PBDFC could offer the lenders a "right-to-match" up to 50% of the senior debt being raised.
In either circumstance above, if the bidder can provide sufficient evidence that competition has been held in a manner consistent with Section 9 of this guidance and the Authority's financial advisor believes that the terms secured are in line with current market expectations and would not be improved by further competition then an Authority may decide a PBDFC will not improve value for money and consequently is not necessary.