Russia’s Vnesheconombank (VEB) and a club of international banks have signed an agreement on a US$1.49bn syndicated loan for the construction of a polypropylene production complex in Tobolsk, Russia.

The syndicate of seven banks includes Calyon, Deutsche Bank, Intesa Sanpaolo, ING Bank, Société Générale Corporate and Investment Banking (as initial mandated lead arrangers and bookrunners) and KFW Ipex-Bank and Sumitomo Mitsui Banking Corporation (as mandated lead arrangers).

Within the scope of the common terms agreement, a first financing tranche in the form of a Hermes facility agreement for the amount of US$533.8mn was also signed.

The aim of the Hermes facility is to finance a contract for supplying equipment between Tobolsk Polymer (the company that will execute the construction) and German company Linde-KCA-Dresden. The total tenor of the ECA financing is 13.5 years.

Calyon is acting as global coordinator and documentation agent for the financing and Deutsche Bank as facility agent and Hermes agent.