Borrower considers increasing loan size
Commercial Bank of Dubai (CBD) is considering increasing the size of its $400m loan refinancing after receiving an oversubscription on the deal.
A source close to the deal says: “The response has been good and CBD is considering whether to take more than $400m.”
Germany’s Commerzbank is co-ordinating the nine-bank deal, which includes the UK’s Standard Chartered and Lloyds TSB, France’s BNP Paribas and Bank of New York Mellon.
The loan on the new deal is thought to be about 225 basis points above the London interbank offered rate (Libor). The deal will have a tenor of three years and will refinance an existing three-year loan that matures in September, priced at 75 basis points above Libor.
The bank group on the deal is also understood to include several new names compared with the 2008 transaction. It is the latest sign that lenders and investors are more comfortable with lending to Dubai names and follows the completion of an $800m loan secured on Salik toll road receipts, the successful raising of about $2.8bn for Investment Corporation of Dubai and a bond issue by Emirates Airline.
The deal is expected to reach financial close later in the summer, ahead of the September maturity of the existing loan.
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