Lead arrangers are moving ahead to finalise general syndication for the $475 million Qatar Vinyl Company (QVC) project finance facility. A roadshow was held in London on 25 February. General syndication is now expected to be completed by the end of March after banks have been given until 16 March to submit their offers. The deal is expected to include a significant bond element (MEED 18:12:98).

The revised 12-year loan, including a three-year grace period, has been lead arranged by Arabian Petroleum Investments Corporation (Apicorp), Banque Paribas and Credit Suisse First Boston. The underwriters are Arab Banking Corporation, ANZ Investment Bank, Banque Nationale de Paris, Societe Generale, Deutsche Morgan Grenfell and Industrial Bank of Japan. Prospective syndication banks are being offered an upfront fee of between 50-80 basis points (bp) over Libor for participation levels ranging from $5 million to $20 million. Bankers say that up to 50 banks may participate, as the lead arrangers aim at involving the maximum number of banks.

The final interest on the loan depends on the launch of a bond, worth a minimum of $150 million, by the end of 1999. If the bond is launched, the loan will carry interest of 70 bp for the 36-month construction period and the banks will have recourse to the sponsors of the project.

Interest will rise to 150 bp for the next 10 years and 170 bp for the last two years. If the bond is not launched, interest will rise to 145 bp for the construction period, 225 bp for the next 10 years and 232.5 bp for the last two years. The principal will be repaid in 18 half-yearly instalments.