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Overview

Bank of China contributes to a $630 million USD syndicated loan to Carlyle Group for its acquisition of a 70% stake in VXI Global Solutions (Linked to Record ID#105367)

Commitments (Constant USD, 2023)$229,051,530
Commitment Year•2016Country of Activity•United StatesDirect Recipient Country of Incorporation•United StatesSector•Business And Other ServicesFlow Type•Loan

Status

Project lifecycle

Completion

Pipeline: PledgePipeline: CommitmentImplementationCompletion

Timeline

Key dates

Commitment date
Nov 1, 2016
Start (actual)
Dec 31, 2016
End (actual)
Dec 31, 2016
Last repayment (originally scheduled)
Oct 31, 2021

Stakeholders

Organizations involved in projects and activities supported by financial and in-kind transfers from Chinese government and state-owned entities

Ultimate beneficial owners

At least 25% host country ownership

Funding agencies

State-owned Commercial Banks

  • Bank of China (BOC)

Cofinancing agencies

Private Sector

  • CTBC Bank (formerly Chinatrust Commercial Bank)

State-owned Commercial Banks

  • China Merchants Bank Co., Ltd.

Receiving agencies

Private Sector

  • The Carlyle Group, Inc.

Loan description

2016 $630 million USD syndicated loan to Carlyle Group for its acquisition of a 70% stake in VXI Global Solutions in the United States

Interest type•Variable Interest RateMaturity•5 years

Narrative

Full Description

Project narrative

Circa early November 2016, a syndicate of three banks — the Bank of China (BOC), China Merchants Bank Co., Ltd., and CTBC Bank acting as mandated lead arrangers and bookrunners — entered into a $630 million USD syndicated leveraged buyout (LBO) loan agreement with The Carlyle Group, Inc. — an American multinational private equity and asset management firm publicly traded on the Nasdaq Stock Market — to finance its acquisition of a 70% stake in VXI Global Solutions LLC. This loan carried a maturity period of five years, an interest rate based on a floating rate plus a margin (with all-in pricing between 400 and 500 bps) and was divided into two tranches: a $600 million USD amortizer tranche and a $30 million USD revolver tranche. Record ID#105366 captures BOC's contribution. Record ID#105367 captures China Merchants Bank's contribution. The proceeds were to be used by the borrower to finance some 90% of the purchase price of a 70% stake in VXI Global Solutions, a business process outsourcing (BPO) company headquartered in Los Angeles, California. It employs 17,000 people globally and over 8,000 in China. VXI is considered to be a China-focused global outsourcer with high growth potential in the small BPO industry in China; VXI has operations in six major mainland Chinese cities and Hong Kong and counts Alibaba as a key client. VXI also has major operations operations in Guatemala, El Salvador, and Barranquilla, Colombia and in Youngstown, Ohio. Carlyle entered a deal to buy VXI in early August 2016. The acquisition was completed in the fourth quarter of 2016. In May 2022, Bain Capital Private Equity acquired VXI Global Solutions from Carlyle Group.

Staff comments

1. The individual contributions of the three lenders to this $630 million USD syndicated loan are unknown. AidData has assumed they contributed both the $600 million USD tranche and the $30 million USD tranche. For the time being, to estimate BOC and China Merchants Bank's contribution, AidData has assumed that each lender contributed equally ($210,000,000 USD) to the overall loan syndicate. 2. It is very likely the specific borrowing institution was a special purpose vehicle wholly-owned subsidiary of The Carlyle Group, Inc. This issue merits further investigation.