Narrative
Full Description
Project narrative
On June 26, 2017, financial close was reached on a deal in which three banks — Bank of China (BOC), Export-Import Bank of Korea (KEXIM), and Kookmin Bank — entered into a $275 million USD syndicated loan agreement with Samchully Midstream 3 LLC — a Delaware-incorporated special purpose vehicle (SPV) jointly-owned by Samchully Asset Management Co. Ltd. (90%) and the E1 Corporation (10%) that owns a 34% stake in Cardinal Gas Services LLC — for the Cardinal Gas Services 2017 Refinancing Project. This loan carried a maturity period of four years, a final maturity date of June 26, 2021, and an interest rate of LIBOR plus a margin of 320 basis points (bps). The loan facility included a $115 million USD direct loan, a $110 million USD covered loan, a $25 million USD uncovered loan, and a $25 million sponsor-affiliated loan. Each lender contributed $91.67 million USD to the loan syndicate. The proceeds of this loan were to be used to refinance a wet gas gathering pipeline facility in the Utica Shale play in eastern Ohio.
Staff comments
1. The refinancing facility included a $110 million covered loan. Whether the coverage was a guarantee or insurance is unknown. This issue warrants further investigation. 2. The following organizations played the following roles in the loan agreement: EY acted as financial adviser to sponsor(s); Clifford Chance provided legal advice to Samchully and E1 Corporation; Kim & Chang provided legal advice to lender(s); and Latham & Watkins provided legal advice to KEXIM. 3. Each lenders' contribution to each tranche is unknown. This issue warrants further investigation. 4. A 6-month LIBOR rate was assumed. The average 6-month LIBOR rate for June 2017 was 1.43228%. Therefore, the interest rate has been coded as 1.43228% + 3.20% (320 bps) = 4.63228%.