Several export credit agencies are involved in the diverse US$6bn debt-funding package that will partially finance a new project of the Saudi Kayan petrochemical company (Saudi Kayan), an affiliate of the Saudi Basic Industries Corporation (Sabic).
The new complex in Jubail Industrial City will be the world's largest integrated petrochemical complex and is expected to be operational in the fourth quarter of 2010.
The financing documents for the project were finalised on May 31 and involves a group of banks and financial institutions.
Arab Banking Corporation, BNP Paribas, and Samba acted as financial advisers and mandated lead arrangers with ABN Amro and HSBC to provide a 15-year, $1.8bn commercial bank tranche, paying 65 basis points over Libor with a step-up to 75bps. Fees for the commercial bank tranche are 100bps.
The transaction also includes a US$1.5bn export credit agency-covered tranche with insurance coverage divided equally between ECGD, KEIC, and Sace. Fees for the ECA-backed tranche are 25bps. There is also a US$1.5bn loan from the state-owned Public Investment Fund (PIF) of Saudi Arabia, a US$530mn Saudi Industrial Development Fund (SIDF) loan and a US$500mn Kexim loan. Al Rajhi Banking and Investment Corporation is providing an Islamic working capital facility.
The project has been in the market since last October with financial close reportedly delayed to due to legal issues. It has also been reported that banks re-committed to the project on pre-credit crunch levels after the expiry of initial commitments.
Sabic holds a 35% of the shareholding in Saudi Kayan, with a private shareholder, Al Kayan Petrochemical Company holding a further 20%. The remaining 45% is held by Saudi shareholders following an initial public offering last year.
The Jubail complex will have a capacity of 6mn tons a year in a variety of petrochemical products including ethylene, propylene, polyethylene, polypropylene and ethylene glycol.
Reader Comments