Banks are being invited to participate in the general syndication of a US$1.5bn five-year amortising pre-export finance facility for the Russian steel producer NLMK. Initial co-ordinating mandated lead arrangers on the transaction are BNP Paribas and Soci&eaute;té Générale
During senior syndication, a number of banks joined the facility. Participating as mandated lead arrangers and bookrunners are Deutsche Bank, SMBC, The Bank of Tokyo-Mitsubishi UFG and UniCredit. ABN Amro and Fortis Bank also joined as mandated lead arrangers, while KBC Bank committed to the deal as a senior lead arranger.
General syndication officially launched on April 22, and a well-attended bank meeting took place in Paris on April 25.
The pre-export facility is the company's debut syndicated deal, as the corporate has been virtually debt free in the past few years.
It is structured as a standard five-year steel pre-export finance facility secured by an assignment of the full chain of commercial contracts from the company to the trader of NLMK group, and then on to a diversified pool of buyers. The facility pays a margin of 120 basis points over Libor.
NLMK reported a turnover of US$7.7bn in 2007, and is regarded as one of the best performing steel companies in the world. It has an EBITA [earnings before interest, tax and amortisation expenses] margin of 40%. It also has the highest credit rating among Russian steel producers, with a BB+ rating from Standard and Poor's, Ba1 from Moody’s and BB+ from Fitch Ratings.
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