ICBC contributes to a €450 million EUR syndicated loan to Tessenderlo for refinancing purposes

Project narrative

On February 26, 2010, a syndicate of 15 banks — including the Industrial and Commercial Bank of China (ICBC) — signed a €500 million EUR syndicated loan agreement with Tessenderlo Chemie N.V. — a Belgium-incorporated and headquartered chemicals company listed on Euronext Brussels — and Tessenderlo Finance N.V. — a Belgium-incorporated wholly-owned subsidiary of Tessenderlo Chemie — and Tessenderlo NL Holding B.V. — a Netherlands-incorporated wholly-owned subsidiary of Tessenderlo Chemie — for refinancing and general corporate purposes. The loan was divided into three tranches: a €167 million EUR term loan A tranche with a maturity period of 18 months (1.5 years), a €233 million EUR revolver B tranche with a maturity period of three years, and a €100 million EUR revolver C tranche with a maturity period of three years. Each tranche carried an interest rate based on a floating rate plus an initial margin of 300 basis points (bps), with the margin based on a leverage grid; the revolver tranches have commitment fees equal to 40% to 45% of the applicable margin. The loan carried financial covenants for the borrower's maximum gearing, minimum coverage of the interest, maximum leverage, maximum factoring amount, and maximum net debt. Tessenderlo Chemie, Tessenderlo Finance, and Tessenderlo NL Holding issued guarantees for this loan. The proceeds were to be used by the borrower to consolidate outstanding bilateral facilities (i.e. refinance them into the syndicated loan) and for general corporate purposes. Mandated lead arrangers got fees of 110 bps for €50 million EUR commitments, lead arrangers got fees of 90 bps for €35 million EUR or more commitments, and arrangers, like ICBC, got fees of 75 bps for €20 million EUR commitments. Record ID#104931 captures ICBC's contribution. On December 20, 2010, the loan was amended. As of December 31, 2010, €9.5 million EUR was outstanding under the loan. On April 28, 2011, a syndicate of 11 banks — including ICBC — signed an amendment and extension for €450 million EUR of the €500 million EUR loan with Tessenderlo Chemie N.V., Tessenderlo Finance N.V., and Tessenderlo NL Holding B.V. for refinancing purposes. This loan carried a maturity period of five years, a final maturity date of April 2016, and an interest rate based on 1, 2, 3 or 6-month EURIBOR plus an initial margin of 110 bps with the margin ranging from 100 to 160 bps based on the leverage (net financial debt/REBITDA) of the borrower; the loan was divided into two tranches, a €350.0 million EUR revolving credit facility (RCF) tranche known as Facility B and a €100.0 million EUR RCF tranche known as Facility C. The loan carried financial covenants for the borrower's maximum gearing, minimum coverage of the interest, maximum leverage, and maximum factoring amount. Tessenderlo Chemie, Tessenderlo Finance, and Tessenderlo NL Holding issued guarantees for this loan. The proceeds of this loan were used by the borrower to refinance the €500 million EUR loan signed in February 2010, namely the €9.5 million EUR outstanding balance. Record ID#104932 captures ICBC's contribution. In addition to ICBC, the following lenders contributed to the loan syndicate: BNP Paribas S.A., Crédit Agricole Corporate and Investment Bank (CACIB), Commerzbank AG, Fortis S.A./N.V., ING Bank N.V., KBC Bank N.V., Banque LBLux S.A., Credit Crédit Lyonnais, Dexia Bank, and Caisse d'Epargne Nord France Europe (CENFE). BNP Paribas, CACIB, Commerzbank, Fortis, ING Bank, and KBC Bank served as mandated lead arrangers and bookrunners. The loan was oversubscribed in syndication. As of December 31, 2011, €10 million EUR had been drawn from the loan from ING, while €28.3 million EUR was used as a guarantee.