Narrative
Full Description
Project narrative
On August 16, 2022, financial close was reached on a deal in which a syndicate of 12 banks — including ICBC, Agricultural Bank of China, and Bank of China — entered into a $4.36 billion USD syndicated loan agreement with Oracle Corporation, a Delaware-based multinational technology corporation specializing in cloud computing, database management, and enterprise software solutions. The loan is divided into two Tranches: while Tranche 1’s ($3.6 billion) maturity is five years, Tranche 2’s ($790 million) maturity is three years, and the interest rate is SOFR plus an applicable margin. The borrower has the option to increase the commitment to a maximum of $6.0 billion. The proceeds were used by Oracle Corporation for refinancing purposes. While ICBC (Record ID#106040), Agricultural Bank of China (Record ID#106041), and Bank of China (Record ID#106042) contributed to this loan, the following lenders also participated: The Bank of Nova Scotia, BNP Paribas, Credit Agricole Corporate and Investment Bank, National Westminster Bank, PNC Bank, Sumitomo Mitsui Banking Corporation, State Bank of India, U.S. Bank National Association, and The Toronto-Dominion Bank. On November 2, 2022, certain lenders and the borrower exercised the incremental commitment option, increasing the total commitment by $1.3 billion. While ICBC committed $170 million extra (Record ID#106043), Bank of China committed $300 million USD extra (Project# 106044). DBS Bank and Oversea-Chinese Banking Corporation also participated in this upsizing. The upsizing has the same terms as the original loan.
Staff comments
1. Oracle Corporation, headquartered in Austin, Texas, is a globally recognized leader in database software, cloud computing, and enterprise software products. Founded in 1977, the company serves clients worldwide, ranging from small businesses to large enterprises, providing solutions for data management, analytics, and digital transformation. 2. AidData estimates the interest rate for this loan based on the SOFR benchmark rate plus an applicable margin as indicated in the credit agreement. The SOFR rate for November 2022 is 3.05%, and the applicable margin was 1.475% as of November 2022. Therefore, the all-in interest is 1.475%+3.05%=4.525%. 3. Because ICBC's contribution to the upsizing is for Tranche 1 (5 year maturity). Hence, the final maturity date is August 21, 2027. 4. The loan agreement can be accessed at https://www.dropbox.com/scl/fi/k340t612eb48ruybxw6bk/orcl-ex991_421.htm.pdf?rlkey=sz250vaasrnqjik070a00zuyr&st=128t42yq&dl=0