Turkey’s Vestel Elektronik has recently closed a US$125mn letter of credit issuance facility via mandated lead arrangers and bookrunners ABN AMRO and Deutsche Bank AG, London.

The 364-day facility was established for the group of companies including Vestel Elektronik Sanayi ve Ticaret, Vestel Komnikasyon Sanayi ve Ticaret, Vestel Beyaz Esya Sanayi ve Ticaret, Vestel Dijital Uretim Sanayi and Vestel Holland.

The facility was significantly oversubscribed, despite the recent economic turbulence in Turkey.

The borrowers elected not to take any of this oversubscription given their expected requirements for letters of credit over the next three months.

Vestel Elektronik is a leading Turkish manufacturer of consumer electronics, digital products and white goods and had turnover of €2.8bn in 2005, of which 72% comprises exports, mostly to Europe. As a result of the export focus, the company has been able to gain a significant share of the European TV market and has become one of the leading Turkish exporters.

The following banks joined as lead arrangers: Alpha Bank; Calyon; Fortis Bank; ING Bank; RZB.

Arrangers are: BBVA, Milan; Bank of Tokyo-Mitsubishi UFJ, and Turkiye Garanti Bankasi.

Lead managers are: Banco di Roma, Banque Internationale du Commerce – BRED, Geneva; Citibank, Bahrain; LRP Landesbank Rheinland-Pfalz; State Bank of India, Offshore Banking Unit, Bahrain.

This financing will support Vestel’s growth prospects and strategic development, claims the firm, enabling the country’s leading exporter to produce higher volumes and strengthen its presence in export markets.

The facility is intended to meet Vestel’s seasonal requirements and will serve to back-stop the company’s payment obligations under sale and purchase agreements with its suppliers, related to the import of goods for production. It will also help improve daily operational efficiency.

The commitments of the mandated lead arrangers and the participation of 12 other leading international commercial banks as well as a top tier local bank in this financing are further evidence of the continued support for high quality private sector corporates in Turkey, as well as maintained confidence in the Turkish economy, claim the mandated lead arrangers.