'The invitation will go out to all the usual international and regional suspects, but given the current geopolitical situation one would expect most of it to be taken up by regional banks,' says one of the lead arrangers. 'There is no mistaking that the extent of due diligence being conducted by the international banks is higher than usual and that credit committees are becoming very reluctant to increase regional exposure.'

Bankers involved in the transaction say that the mandated lead arrangers are hoping to place $400 million-450 million during the general syndication. 'We would be pretty happy if we shifted this much as it would bring most banks down to their designated hold targets,' says another banker. 'But we will have to see how the market reacts in these difficult times. There are concerns over placing this now, even though it is a fundamentally sound transaction.'

Some of the concerns voiced over syndication stem from the extent of remaining regional appetite for the deal. Four leading Saudi project finance banks and the three regional powerhouses are among the lead arranging group of JP Morgan Chase & Company, HSBC Investment Bankwith its local affiliate The Saudi British Bank, Credit Agricole Indosuezwith its local affiliate Al-Bank Al-Saudi Al-Fransi, Saudi American Bank, Arab Bank with Arab National Bank, Arab Petroleum Investments Corporation (Apicorp), Gulf International Bankand Arab Banking Corporation (MEED 31:5:02). In addition, two more Saudi banks - Riyad Bankand Saudi Hollandi Bank- and National Bank of Abu Dhabi,a regular regional cross-border lender, joined at the sub-underwriting level. The fourth sub-underwriter is ING Bank (MEED 9:8:02).

'There is regional liquidity available, but if the international banks stay away, as is widely expected, moving $450 million could be hard work,' says another of the lead arrangers. 'On the positive side, this is a good opportunity to take a four-and-a-half-year exposure to Saudi Arabia's prime borrower and it should be stressed that the acquisition is going really well: Sabic and DPC are both ahead of their base case projected performances.'

JP Morgan is the financial adviser on the transaction.