Investcorp, the Bahrain-based investment bank, has signed a $400 million revolving credit facility with international and Arab banks. The facility is priced at 65 basis points over the London interbank offered rate (Libor), with a commitment fee of 32.5 basis points.

The bank says it set out to raise $250 million, but decided to enlarge the borrowing after it was substantially oversubscribed. The credit will be used 'to meet efficiently periodic temporary funding requirements, arising from its principal activities, without the need to disturb its short-term liquid investment

programmes,' the bank says. The arranging group comprised 25 international and Gulf Arab banks, with the book runners being Bankers Trust International and Chase Investment Bank. A total of 62 banks took part in syndication of the facility.

Investcorp has a long track record of acquiring underperforming companies in the US and Europe, turning them around and selling them. Earlier this year, it bought the UK's Welcome Break, a chain of motorway service stations, for £473 million (then $758 million). The bank says the new facility is not intended to cover the costs of this acquisition. Investcorp was reported to have been considering a bond issue backed by Welcome Break's cashflow, though bankers say the idea appears to have been dropped. Taking up the credit will bring Investcorp's medium-term liabilities to

$850 million, or two-thirds of its total liabilities. Almost all of this debt matures in or after 2000.