The mandated lead arrangers are Arab Banking Corporation, Gulf International Bankand Sumitomo Mitsui Banking Corporation.
The facility has tenor of five years, with a two-year grace period giving an average life of three and a half years. It has a margin of 52.5 basis points (bp) over Libor.
‘Syndication is going smoothly and we’ve already had some major commitments. We are expecting it to close by mid April,’ says one of the bankers involved.
Participants have been offered three tickets. At the top end, $35 million tranches have been offered with fees of 35 bp. The next level sees $25 million tickets with 30-bp fees and the junior level is for $15 million tickets offering 25 bp.
The facility is the first sovereign borrowing made by Qatar since a protracted $500 million, seven-year borrowing finally closed in late 2000 (MEED 17:11:00). Prior to that, a five-year, $300 million sovereign loan was taken out in late 1997. It is a reflection of shifting market sentiment and the gradually rising cost of commercial borrowing that despite a sharply improved financial situation, and sovereign rating upgrades reflecting this, the 1997 loan had an initial margin of only 32.5 bp (MEED 15:8:97).