Under the Privatization Option, financing cash flows shall be included into the Privatization Option financial model. As part of the Third File, the Work Team shall set out the envisaged funding structure for the project including the debt and equity mix, sources of funding and overall cost of capital envisaged based on the market assessment.
The Work Teams shall model these funding cash flow projections as part of the Privatization Option financial model and clearly set out the assumptions. The key assumptions shall include:
a) Sources of debt, quantum, cost of the funds from each source and any associated constraints that are likely to be imposed by potential lenders on the size and structure of loans including service coverage ratios and amortization schedule (the Work Teams shall amortize the debt equally over the life of the debt unless other constraints take priority).
b) Sources of equity, quantum of funds and equity returns envisaged by the private partner.