Mandated lead arranger KBC Bank has signed and disbursed a US$150mn loan for UGMK, one of Russia’s largest copper producers.
The facility has been structured as a limited recourse loan to Glencore, who has used the funds to prepay the Russian producer for future deliveries of refined copper.
The transaction has a tenor of 36 months, amortising equally over a 24-month period following a 12-month capital grace period. Whilst it is secured against the supply of refined copper, several core operating companies from within the producer’s group have additionally provided sureties.
A spokesman from KBC comments: “KBC’s commitment to the structured finance market allied with a strong structuring team that is customer and product driven has resulted in successfully achieving this landmark transaction for the bank, whilst meeting the needs and expectations of a valued client.”
General syndication of the transaction was launched in July 2005.
UGMK, which combines 30 enterprises in ten Russian regions, is Russia’s second largest copper producer after Norilsk Nickel, with about a 40% market share of the domestic cathode copper market, a quarter of the domestic market for nonferrous alloys and more than half of the European market for copper powders.
UGMK has said its consolidated net profit soared 180% to Rb4.52bn in 2004. Pretax profit grew 170% to Rb6.73bn, operating profit 110% to Rb8.77bn and sales 70% to Rb73bn.