Sharq debt package surfaces

28 October 2005
Banks have been asked to respond by the end of October to the request for proposals (RFP) on the debt package for the $2,500 million expansion programme of Jubail-based Eastern Petrochemical Company (Sharq). The sponsors are looking for $972 million in commercial debt, to be supplemented by a tranche in excess of $1,000 million from the Japan Bank for International Co-operation (JBIC).

Among the banks understood to have been invited to join the deal are Arab Bank, Arab Petroleum Investments Corporation (Apicorp), Bank of Tokyo Mitsubishi - which is also acting as financial adviser, Banque Saudi Fransi, BNP Paribas, Calyon, Gulf International Bank, HSBC, Mizuho Financial Group, Riyad Bank, Royal Bank of Scotland, Saudi British Bankand Sumitomo-Mitsui Banking Corporation. Minimum ticket sizes have not been specified but bankers looking at the deal say that commitments of at least $100 million are likely to be required. The tenor is 10 years. The top ticket is $150 million take and hold.

The launch of the financing follows the signature in early October of the three remaining engineering, procurement and construction (EPC) contracts on the phase 3 expansion of Sharq's olefins complex. Sharq is a 50:50 joint venture of Saudi Basic Industries Corporation (Sabic)and a group of Japanese companies led by Mitsubishi Corporation(MEED 29:7:05).

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