Saudi Arabian Mining Company (Maaden) has agreed pricing of just 85 basis points above the Saudi interbank offered rate (Sibor) for a SR7bn ($1.9bn) five-year loan.

Several banks in the kingdom are understood to have tried to push for higher pricing on the loan, but were unsuccessful in the face of strong pressure within lenders to book new deals. Maaden will also pay upfront fees of 95 basis points.

“The deal was around 2.5 times oversubscribed, so Maaden was in a good position to squeeze the banks on pricing,” says one banker in Riyadh.

The deal will be funded by a group of banks comprising the local National Commercial Bank, Samba, Riyad Bank, Banque Saudi Fransi, Al-Rajhi, Bank Al-Jazeera, Bank al-Bilad, Saudi Investment Bank, and the US’ JP Morgan.

Maaden is currently in the process of looking for an adviser for its second major phosphates project, a phosphate mine in Umm Wual, in the north of the country. The project is expected to cost around $6bn to develop and according to sources in Riyadh the firm is expected to appoint an adviser on the scheme before the end of June.