Equate Petrochemical Companyhas signed a $600 million bridge financing facility. The funds will be used for a combination of refinancing of a 10-year, $600 million term loan, itself a refinancing signed in 2001 to pay for the original Equate petrochemicals facility at Shuaiba, and fresh financing for the olefins II project to double the plant's capacity (MEED 23:11:01).
The one-year, $600 million bridge is split equally between a conventional and Islamic tranche, arranged by Kuwait Finance Houseand National Bank of Kuwait - which arranged the original financing. Its margin was 50 basis points (bp) compared to 80 bp on the term loan. Societe Generale (SocGen)is financial adviser on the olefins II project and Linklaters acted as legal adviser on the bridge. Equate Petrochemical Company is owned 45 per cent each by the local Petrochemical Industries Companyand the US' Dow Chemical Company. The local Bubiyan Petrochemical Companyin mid-November sold 1 per cent of Equate, out of its 10 per cent stake, to a new company called Al-Qurain Petrochemical Companyfor $42 million. An initial public offering (IPO) in Al-Qurain is due imminently. In late July, the US' Fluor Danielreceived a letter of intent for the contract to provide project management consultancy (PMC) services for the olefins II project, which involves the construction of an 850,000-tonne-a-year (t/y) ethane cracker, a 600,000-t/y ethylene glycol/ethylene oxide unit and 400,000 t/y of new polyethylene capacity (MEED 6:8:04).