A $120 million loan for Petron Corporation, the Philippines’ leading oil refinery, was signed on 14 September. The three-year senior term loan facility was priced at 110 basis points over Libor, excluding fees.
Syndication for the facility was oversubscribed, with particularly strong participation from Gulf institutions, the arrangers say.
The Philippines government has a 40 per cent stake in Petron, Saudi Aramco holds a further 40 per cent and 20 per cent is publicly owned. Khalid al-Falih, a former Saudi Aramco officer, is president and chief executive officer of Petron. The company has a 39.6 per cent market share of the Philippines’ oil refining and marketing, and has the country’s largest retail network.
The co-ordinating arrangers for the threeyear facility were Chase Manhattan Asia, Citicorp International, ING Barings and Saudi American Bank (Samba), which also acted as regional bookrunner for the Middle East. Samba was represented at the signing ceremony by general manager Abdulaziz Barakat. Other Gulf institutions involved in the deal are Arab Petroleum Investments Corporation (Apicorp), Saudi Investment Bank, Bank al-Jazira and The Arab Investment Company.
This is the first time Samba has arranged a facility in the Asia-Pacific region, and is part of the bank’s new strategy of working on Saudi deals outside the kingdom. ‘We intend to follow the business of Saudi Arabia anywhere in the world, ‘ says Enrico Grino, Samba’s assistant general manager. He adds that the bank was pleasantly surprised by the interest shown by Gulf institutions during syndication, and says this is a reflection of Saudi Aramco’s strong involvement in the deal. ‘This perceived it as essentially a Saudi Aramco risk.’
He says Samba is looking at other similar deals in the Far East, but says it is too early to provide details.
The Petron loan participants
Co-ordinating arrangers Allocation ($ million)
Chase Manhattan Asia 11.25
Citicorp International 11.25
ING Barings 11.25
Saudi American Bank 11.25
Arab Petroleum Investments Corporation 15
Saudi Investment Bank 15
Arrangers Bank al-Jazira 10
The Arab Investment Company 5
Bank of Tokyo-Mitsubishi 5
Fuji Bank 5 Hua
Nan Commercial Bank 5
Sumitomo Bank 5
United World Chinese Commercial Bank 5
Norddeutsche Landesbank Girozentrale 5