Rusal has successfully closed the senior stage of syndication of US$575mn facility with ABN Amro, BNP Paribas and Citigroup acting as the co-ordinating mandated lead arrangers and bookrunners and with Natexis Banques Populaires acting as the mandated lead arranger. The loan has been oversubscribed, boosting the initially sought facility amount of US$500mn.
The credit will be provided in two amortising tranches for two and five years respectively. The first US$172.5mn tranche, unsecured, matures in one year with an extension option for another 12 months. The second US$402.5mn tranche is based on a classic pre-export finance mechanism and is to be repaid monthly following the 18-month grace period. The lenders will participate in the loan on a pro rata basis.
“The loan is another building block in Rusal’s already solid credit history and a testament to the level of trust the international banking community has in Rusal,” says Oleg Mukhamedshin, Rusal’s deputy chief financial officer. “The first tranche granted for an exceptionally long term of a cumulative two years is unsecured, which is unique for a Russian metals and mining company. We see it as a milestone for our future financing.”
The mandated lead arrangers for the loan are ABN Amro, BNP Paribas, Citigroup and Natexis Banques Populaires. ABN also acted as the facility and documentation agent, while Natexis Banques Populaires fulfilled the role of the offtaker and offtake arrangements and documentation agent. Three of the mandated lead arrangers – ABN Amro, BNP Paribas and Citigroup – were the syndication’s bookrunners.
“This is another successful loan we have extended to Rusal and a groundbreaking facility that we have syndicated for a leading Russian corporate,” says a senior representative of one of the co-ordinating mandated lead arrangers for the facility. “The interest among leading international lenders was so high that we closed the first stage of syndication with an oversubscription.”
The transaction uses the offtake arrangements developed by Rusal in the course of raising its previous loans, including an US$800mn syndicated credit facility of October 2004. The funds raised will be used to refinance the company’s current debt. With the relevant documentation signed in early September, the facility is expected to be disbursed by the end of this month, whereupon in light of the strong appetite in the market, Rusal intends to launch the second general stage of syndication by enlarging the initially limited number of the invited banks.