Qafac refinancing draws closer

26 April 2002

The proposed $300 million refinancing of the debt facility for Qatar Fuel Additives Company (Qafac)is advancing steadily.

'We are close to finalising the structure - it should be finished over the next few weeks - and we are hoping to get the IM [information memorandum] to banks by the end of May or the beginning of June,' says a Societe Generale official. The French bank was given a financial advisory mandate for the deal in January (MEED 18:1:02).

A sizeable payment on the original facility is due in May and, when made, it will reduce the outstandings on the loan to about $240 million, but this will not bring about a reduction in the size of the refinancing.

'We are basing our structure on a full $300 million facility,' says the official. 'The mandate is not just about the repayment schedule, it's also about loosening some of the terms.'

The original package had two tranches: a $140 million, 12-year commercial facility, and a $210 million, Canadian export-credit-backed, 10-year package. The lead arrangers were Bankers Trust International, now part of Deutsche Bank, Banque Paribas, now part of BNP Paribas, Canada's Export Development Corporation, Sumitomo Bank, Bank of Taiwan, Chinatrust Commercial Bank, First Commercial Bankand Gulf International Bank (MEED 19:12:97).

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