Sonangol is looking to tap the market again, following the success of its US$1.4bn syndicated term loan facility secured via its joint venture with Sinopec last year.
A US$3bn eight-year syndicated facility is being arranged via initial mandated lead arrangers Standard Chartered, Natixis, Commerzbank, Banco Espirito Santo (BES).
The banks have now launched senior syndication, which will then be followed by a general phase. A source close to the deal suggested that the IMLAs are looking for a possible six further banks to participate at senior level. The Angolan bank BAI is also said to be participating in the deal.
The transaction has had mixed reactions in the market so far. The borrower has a good track record and despite the instability of the Angolan political and economic system, it has always made its repayments. It is also one of the few sovereign oil companies still borrowing. However, concerns have been raised about the deal’s potential lack of structure given the low rating on the company.
Sonangol raised a US$3bn syndicated facility in September 2005, via coordinating MLA Calyon. This deal has the unusual structure where it was backed by oil revenues secured by a long-term offtake agreement between Unipec and China Sonangol. These funds were used to refinance a previous facility and support the borrower’s capital expenditure in Angola.