Mandated lead arrangers Soci&eaute;té Générale Calyon, Fortis, ING Wholesale Banking and Intesa Sanpaolo have signed a €
450mn financing facility for Turkish car manufacturer Turk Otomobil Fabrikasi (Tofas).
The facility is also supported by a guarantee from the Italian export credit agency Sace, and a tranche provided by the European Investment Bank (EIB).
The funding is being raised to support a new assembly line at the firm's Bursa plant for the production of a new light commercial vehicle to be sold in a number of European markets under the Fiat and Tofas brand names.
Through incorporating Sace and the EIB into the transaction, the borrower was able to obtain far longer financing terms with the transaction carrying a tenor of 10 years.
The deal consists of three tranches: a €
120mn facility fully guaranteed by Sace; a €
200mn EIB facility which is further divided into a €
150mn portion for which the MLAs are guaranteeing the commercial risk, and a €
50mn portion where EIB keeps the commercial and political risk; and a €
130mn tied commercial facility.
Security is being provided by the assignment of the rights of off-take agreements to Fiat.
Initially Tofas mandated Soci&eaute;té Générale as the global coordinating bank and during the arranging phase it acted as documentation agent.
Fortis joined at senior level acting as technical agent and modelling bank, while Calyon acted as Sace facility agent and Intesa Sanpaolo was EIB's agent.
Following the signing of the deal, Soci&eaute;té Générale will act as intercreditor agent, and Fortis will act as security and offshore account agent. Calyon and Intesa Sanpaolo keep their original roles.
Tofas is a major car producer in Turkey, and is listed on the Istanbul Stock Exchange. Sace’s interest in the deal is partly fuelled by the fact that the company was originally established in 1968 as a Turkish-Italian cooperation venture to manufacture cars and light commercial vehicles under licences granted by Fiat Auto.
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