UMBRA – Strategic Legal Solutions (UMBRA) was recently awarded the ‘Project & Infrastructure Finance Law Firm of the Year’ award, one of the prestigious awards from Islamic Finance news. In the realm of Shariah compliant project and infrastructure finance, UMBRA’s ability to navigate complex legal intricacies, provide invaluable insights and deliver exceptional results has set it apart from the Indonesian legal industry. To shed light on the factors that contribute to its success, we present an exclusive Q&A session with two of UMBRA’s seasoned project financing partners, Kirana D Sastrawijaya (Kirana) and Putu Raditya Nugraha (Putu).
A: UMBRA has rapidly emerged as a dominant force in the Indonesian legal industry, transcending its humble beginnings and garnering a remarkable trajectory of growth. With a team of over 70 highly skilled lawyers, UMBRA stands today as one of Indonesia’s largest and most prestigious law firms, commanding respect and admiration from clients and competitors alike.
Having executed over 400 transactions with a total value surpassing US$100 billion, UMBRA has achieved unprecedented success, not only within the Indonesian legal industry but also throughout Asia, leaving an indelible mark on the international stage.
Dedication and aspirations have propelled UMBRA to become the youngest law firm with the most significant and rapid growth in the legal industry in Indonesia, and even in Asia. Even amid the direst circumstances imaginable, UMBRA not only managed to endure but also flourished, expanded and solidified its position, surpassing expectations and etching a new chapter in history as the preeminent independent law firm, playing a vital role in the Indonesian legal industry.
Q: What has propelled UMBRA to rapidly emerge as a dominant force in the Indonesian legal industry, surpassing its humble beginnings and experiencing a remarkable trajectory of growth?
A: While awards and rapid growth are commendable, the true measure of a law firm’s success lies in its ability to endure in an ever-evolving industry. UMBRA has encountered significant challenges, including the unprecedented COVID-19 pandemic and the looming threat of a global economic crisis. Nevertheless, UMBRA has not only weathered the storm but thrived.
UMBRA’s ascent to becoming a dominant force in the Indonesian legal industry can be attributed to its involvement in several groundbreaking deals that have not only showcased our expertise but also propelled our reputation to new heights.
Q: We understand that UMBRA has been awarded the ‘Project & Infrastructure Finance Law Firm of the Year’ award by Islamic Finance news. Can you tell us the story of your past deals that led to this award?
A: We are thrilled to highlight two remarkable Shariah deals from 2022 that have truly made a significant impact. These groundbreaking transactions have positioned UMBRA as the ultimate victor and bestowed upon us this highly prestigious designation.
One of our most notable Shariah deals involved representing Bank Syariah Indonesia (BSI), the largest Shariah compliant bank in Indonesia, in providing a IDR750 billion (equivalent to US$50.47 million) facility under the Islamic banking Musharakah structure to Medco Power Indonesia, in relation to the financing of its renewable energy project. In this transaction, BSI took on the roles of mandated lead arranger, facility agent and escrow agent.
This deal stands out due to our remarkable advisory role, which extends beyond conventional boundaries. Not only did we provide guidance on the sell-down mechanism, allowing a new lender to provide the loan while also ensuring its compliance with relevant laws and regulations, but we also took additional measures to ensure the financing also complies with Shariah principles. We are taking further steps to demonstrate our profound expertise in the realm of Shariah compliant financing.
By meticulously crafting a sell-down mechanism that satisfies both legal requirements and Shariah principles, we underscored our ability to deliver results while navigating the complexities inherent in Islamic finance. We believe that this exceptional achievement showcases our unwavering commitment to ‘get things done’ in a manner that upholds the highest standards of ethical and Shariah compliance.
In the second deal, we also played a pivotal role as the lead legal counsel for Celebes Railway Indonesia, Indonesia Infrastructure Finance, Sarana Multi Infrastruktur and Bank Syariah Indonesia. Our team facilitated the execution of both conventional and Shariah (Musharakah Mutanaqisah) facility agreements to secure funding for the Makassar–Parepare Railway project. This initiative, valued at approximately IDR1 trillion (US$67.22 million), marked the inaugural railway public–private partnership (PPP) in Indonesia.
This groundbreaking deal establishes Indonesia’s first-ever railway PPP, setting a precedent for future infrastructure projects. With an investment value of approximately IDR1 trillion, the Makassar–Parepare Railway project addresses critical infrastructure needs in the region, promoting economic growth and improving transportation accessibility for local communities. The deal showcases innovative financing approaches, successfully executing both conventional and Shariah financing agreements, attracting a wider range of investors, and promoting sustainable development aligned with Shariah principles. The government’s support and collaboration, as evidenced by the presence of the Ministry of Transportation, reflect a shared vision for infrastructure development. Furthermore, our role as the leading legal counsel is of utmost significance. We ensure legal compliance, manage risks and provide the necessary expertise for a successful transaction, reinforcing the deal’s credibility and mitigating potential legal challenges. We believe that our involvement in this project highlights our reputation and expertise in facilitating complex infrastructure projects, solidifying the deal’s overall importance.
Other than those two deals which have also been recognized in UMBRA’s achievement as ‘IFN Project & Infrastructure Finance Law Firm of the Year 2022’, our other Shariah notable deal was the transaction involving Pertamina EP Cepu, which acted as the sponsor for a major project financing initiative. It secured a funding facility of approximately US$1.85 billion to support the Jambaran–Tiung-Biru (JTB) gas field unitization project. UMBRA played a crucial role in organizing the financing through a trustee borrowing scheme, which included both conventional and Wakalah facilities. The JTB project, recognized as a National Strategic Project, was sought after by the Committee for Acceleration of Priority Infrastructure Delivery. UMBRA’s expertise in Shariah compliant project financing and adeptness in managing intricate arrangements contributed to the successful completion of the deal. This achievement garnered numerous awards and acknowledgments for excellence in the realms of Islamic finance and the oil and gas industry. This deal was awarded as ‘Oil and Gas Deal of the Year’ in the 2019 Project Finance International Awards and ‘Deal of the Year’ by 2019 Asian-mena Counsel Deals of the Year.
Q: What would be your key takeaway from those deals?
A: These transformative deals serve as an eloquent testament to UMBRA’s exceptional legal acumen, strategic counsel and unwavering ability to navigate the intricate web of legal landscapes and Islamic jurisprudence with utmost finesse. We see that this relentless pursuit of excellence has positioned us as a trusted advisor in the realm of Shariah compliant transactions, solidifying our unparalleled position as a preeminent law firm in Indonesia. The significance of our involvement in these key Shariah deals exemplifies our unwavering commitment to providing a comprehensive range of legal services that cater to a diverse set of principles and requirements.
We recognize the importance of accommodating the needs and values of a wide range of clients, and we strive to ensure that our legal services are accessible and suitable for all, especially for our Shariah natured clients. Moreover, our involvement in these deals reflects our dedication to innovation. Shariah financing involves unique mechanisms and principles that require a deep understanding and expertise. By successfully navigating and executing these complex agreements, we showcase our ability to adapt and provide innovative legal solutions in emerging areas of law.
Q: How would you position your firm in the Islamic finance industry in Indonesia?
A: With each meticulously crafted Shariah compliant transaction, we not only try to solidify our unparalleled position as a preeminent law firm in Indonesia but also assume a commanding role in shaping both the country’s Shariah and legal industries. Our strategy is to leverage our team’s deep understanding of Islamic law and our ability to harmonize it with modern legal frameworks. We believe that we can contribute to the development and evolution of both Shariah and legal practices in Indonesia. This progressive approach ensures that the country’s legal system remains dynamic and relevant in the face of changing societal and economic landscapes.
Q: What do you think the award of ‘Project & Infrastructure Finance Law Firm of the Year’ would mean to your firm?
A: Winning the title of ‘Project & Infrastructure Finance Law Firm of the Year’ stands as a resplendent reflection of our unwavering commitment to excellence, unparalleled expertise and steadfast dedication to the advancement of our clients’ needs and interests. By seamlessly maneuvering through the complexities of the legal and Shariah domain, we leave an indelible mark on the tapestry of Indonesia’s legal and Shariah landscape, etching an enduring legacy of profound impact. By setting new standards and pushing boundaries, we pioneer innovative solutions and pave the way for a brighter future.