Term of Reference

Project: [Title of the Project, shall likely state that the project shall be
implemented in PPP mode

Administrative authorities responsible:

Government Agency [Insert name of relevant Government Agency/Administrative

Department],Government of the Punjab, (the “Client”)

1. BACKGROUND

[Provide a brief outline of the background to the project. This should include detail as to why the
project is being proposed, whether the type of project has been done before in Pakistan, or the
model utilized internationally. Maximum one A4 page.]

2. OBJECTIVES:

[Detail the objectives, or goals, the project intends to achieve. This should provide further detail
of the problems the project is seeking to address, and should specify three to six bullet point
objectives which briefly encapsulate the key aims of the project. Maximum two A4 pages.]

3. THE ASSIGNMENT

The department intends to procure the services of an experienced Transaction Advisor (Firm
/ Consortium) to assist it through the phases of the PPP project development and
procurement. Broadly, the Transaction Advisor will be required to (i) conduct essential due
diligence; (ii) assess the feasibility of the proposed project; (iii) design bankable PPP structures
with equitable allocation of risk between Government and private party; (iv) run the
procurement process in an efficient and transparent manner; (v) culminating in the timely
award of the PPP Concession to the winning bidders, (the “Assignment”).

The assignment will consist of following two phases:

Phase-I: Project Development

Phase-II: Transaction Execution

4. SCOPE OF ASSIGNMENT

Phase-I: PROJECT DEVELOPMENT

Task 1: Kick-off Meeting

Within one week of signing the Transaction Advisory Services Agreement (TASA), the
Transaction Advisor (TA) will convene a kick-off meeting with the Client and its representatives
to discuss and finalize the detailed plan of activities proposed by the TA.

The meeting will cover the following:

i. Review of proposed methodology and requirements to complete the Assignment.

ii. Review of timetable of activities / milestones.

iii. Review of team organization and detailed functions of team members.

iv. Discuss and finalize a communication strategy.

v. Any specific issue requiring immediate attention of Client.

Outcomes:

 Detailed methodology and time schedule.

 Completion dates for the Information Memorandum (IM).
 Communication strategy.
 A brief report on key issues.
Timeline: 01 week

Task 2: Due Diligence

During the process of due diligence TA will liaise closely with the Client and other
relevant stakeholders [and will visit the [relevant site] to collect relevant information – Note: this
is only appropriate if site visits are to be conducted as part of the due diligence. This is likely to
be relevant in the majority of PPP projects]. The TA will also conduct a desk review of
similar models in Pakistan and internationally and present the options, together with a
recommendation as to the most suitable models, for approval. The TA will conduct soft
marketing to assess the appetite of potential investors.

Deliverables:
 Due Diligence Report (Legal, Technical, Operational, Environmental & Financial)
including market assessment for [please specify the project and the proposed site],
including:
 o findings of desk study of national and international practice;

o results of soft investor appetite assessment; and

o [Specify any other relevant key Due Diligence Report contents. This could include
a resettlement plan if relevant, or any other likely social/gender issues. This
should also highlight any tax implications, where relevant.]

Task 3: Feasibility Study, Project Proposal and Bid Documents

The TA will conduct diligence on legal, financial, technical & environmental aspects to
present various PPP Concession modalities.

The TA will prepare and present a comprehensive financial model, together with optimal
design parameters, service level specifications, risks assessment (identification, evaluation,
estimation of risk) and cost analysis, cash flow, sensitivity analysis, Debt Service Coverage,
Return On Equity (ROE) and all such financial analysis, together with an assessment of the legal
feasibility of the project (including an analysis of the financial structure and land use).

3.1 Feasibility study includes the following:

 Business Plan
 PPP modality/Transaction Structure
 Financial model and analysis of project financials (this should demonstrate the project’s
financial and economic viability over the expected duration of the project and permit an
analysis of the affordability of the project)
 Risk allocation matrix
 Role of Government and Private Party
 Asset stock-take
 Monitoring Mechanism
 Key Performance Indicators(KPIs)
 Legal feasibility analysis
 [Include any additional project-specific requirements for the feasibility study, e.g. if
resettlement is required, include ‘recommendations for resettlement’]
Deliverable: Feasibility Report

3.2 Project Proposal includes the following:

 Feasibility study
 Environment Impact Assessment Report
 Need for Government support (quantum, structure and kind)
Deliverables: PPP Project Proposal

3.3 Bid Documents

The TA will develop the following:

 RFQ Package
- Prequalification criteria
- Basis of disqualification
- Data sheet/forms
- Undertakings templates
- RFQ Advertisement
- Any other document that may be required in such transactions.

 RFP Package
- Invitation to bid
- Instructions to bidders
- Bid Evaluation Criteria
- Reference Design parameters [In construction projects ‘minimum design and
performance standards and specifications’]
- Draft Concession Agreement
- [Include where relevant: Bid security form and performance bond form]
- Any other document that may be required in such transactions.
Deliverables: RFQ and RFP Package

Task 4: Communication Strategy and Information Memorandum (IM)

Transaction Advisor will develop a communication strategy for approval by the Client.

Transaction Advisor will develop an Information Memorandum (IM) which will highlight
salient features of the project and broad terms and conditions with a view to market the project to
potential investors.

Deliverables:

 Communication strategy
 Information Memorandum
Task 5: Government Approvals

The Transaction Advisor will assist the Client to obtain necessary government approvals,
e.g PPP Steering Committee, Board of Revenue, Provincial Cabinet etc.
 Phase-II: TRANSACTION EXECUTION

Task 1: Procurement Process

Transaction Advisor will assist the Client in soliciting EOIs, prequalification of potential
bidders, issuance of RFP, pre-bid meetings, bid evaluation, selection of successful bidder and
issuance of Letter of Intent (LOI)/Letter of Award.

Deliverables:

 Pre-qualification Report

 Minutes of Pre-bid meeting

 Bid evaluation report (technical/financial/legal)

 Draft LOI/LOA

Task 2: Deal Closure and Signing of Concession Agreement

Transaction Advisor will assist the Client to reach deal closure and successful signing of
PPP Concession Agreement.

Deliverables:

 Signing of Concession Agreement

Task 3: Financial Close

After signing of Concession Agreement, the Transaction Advisor will analyse the
financials provided by the successful bidder and confirm to the Client whether the bidder has
fulfilled the mandatory requirements of financial close.

Deliverables:

 Financial close
GENERAL CONDITIONS

1. The overall scope of work of the TA shall be dependent on the decision of the PPP Steering
Committee. The TASA will be terminated without notice upon completion of Phase I if the
PPP Steering Committee does not approve the Project for implementation.
2. While the scope of work has been outlined in the TOR, the TA shall also provide assistance
in activities, not specifically mentioned in the TOR, that are necessary for successfully
concluding the Assignment.
3. The PPP Act, 2014, as amended, shall govern the overall process of PPP Project. The
procurement process shall be conducted pursuant to the Punjab Procurement Rules 2014.
4. Any amendments required either by Client any other relevant forum including PPP Cell, Risk
Management Unit and PPP Steering Committee shall be considered to be part of the TORs.
5. Five hard copies and one soft copy of each draft document specified as a deliverable will be
submitted to the Client at the address and email address specified in the TASA. The Client
will offer its comments and recommendations. The TA shall incorporate these into the
final documents and resubmit 5 hard copies and one soft copy of each to the Client.
6. All documents shall be drafted in English.
7. All the data, documents and reports produced by the TA under the TASA shall be the
property of the Client. The TA shall not share or use any data, document and reports for any
purpose beyond providing services pursuant to the TASA without the prior explicit written
approval of the Client. At the end of the Assignment, the TA shall, upon written request
of the Client, destroy or return all materials provided under the TASA.
8. The [executing agency or sponsoring agency, as appropriate] will nominate one member of
staff not below the rank of Director to liaise with the TA regarding the Assignment.
9. The TA shall begin the Assignment as soon as the TASA is signed.
10. If there is any possible conflict of interest arising from the TA advising the Client, the TA
must alert the Client to this as soon as it becomes aware of the potential conflict.
 Transaction Advisor Team Profile

Team Leader

Master’s degree in Project Management/Business Administration/Applied Economics/[other

relevant subject] with ten (10) years’ experience in Project Management, Public Private
Partnership projects, [relevant sectoral experience] and able to manage cross-sectoral team.

Financial Expert

MBA(Finance)/Master Degree in Finance, ACCA, ACMA, CFA with ten (10) years’ experience
of developing projects in PPP mode, due diligence of related financial implications & assurance,
financial modelling, financial analysis, project risk profiling, value for money analysis and
financial closure for PPP projects

Legal Expert

LLB with minimum ten (10) years’ experience of dealing with business/corporate laws, firms
and company laws/ordinances, thorough knowledge of PPP Act 2014, as amended, contract
management, and other domestic and international laws, with expertise in drafting and
negotiating PPP/Concession agreements.

Technical Experts

Technical experts with a minimum (08) years of experience relating to the relevant area, with the
qualifications detailed below: [Note: Set out the academic qualifications and the field experience
required for each technical expert.]

Focal Persons:

[Detail the focal persons at the sponsoring and executing agencies that will act as coordinators for the
project, together with focal persons at the project level.]

Note: Selection will be based on verifiable demonstration of experience and qualifications in

similar projects as well as qualification of firm.