Mubadala to request loan refinancing proposals by late February

10 February 2010

State organisation holds talks with banks to refinance $2bn facility

Banks say they expect to receive a request for proposals later in February from Abu Dhabi’s Mubadala Development Company for a deal to refinance a $2bn loan.

The loan is due to be repaid in April.

Mubadala began talks with the existing banking group on the $2bn facility in early January (MEED 27:1:10).

Key facts

$2bn - Size of loan due in April, which Mubadala is to refinance

17.5 basis points - Cost above Libor of original loan signed in 2007

$1.2bn - Project finance loan needed for Sowwah Square project

Libor=London interbank offered rate

Source: MEED

Bankers who have been involved in talks say the formal request is now expected in late February. “Mubadala has been sounding out banks already but has not yet sent a request for proposals for the deal,” says one banker involved in the talks.

Other financiers say that, based on their discussions so far, Mubadala may even try to increase the size of the loan facility.

The original loan from 2007 was priced at just 17.5 basis points above the London interbank offered rate (Libor).

“Mubadala will get a low price as it is owned by the Abu Dhabi government and highly rated, but it will be nowhere near the pricing on the existing deal,” says a London-based banker.

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