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Overview

Bank of China contributes to a zł2.7 billion PLN syndicated loan to Żabka Polska to finance its acquisition by CVC Capital Partners

Commitments (Constant USD, 2023)$84,547,723
Commitment Year•2017Country of Activity•PolandDirect Recipient Country of Incorporation•PolandSector•Business And Other ServicesFlow Type•Loan

Status

Project lifecycle

Completion

Pipeline: PledgePipeline: CommitmentImplementationCompletion

Timeline

Key dates

Commitment date
Apr 1, 2017
Start (planned)
Jun 30, 2017
Start (actual)
Apr 21, 2017
End (planned)
Jun 30, 2017
End (actual)
Apr 21, 2017

Stakeholders

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

Funding agencies

State-owned Commercial Banks

  • Bank of China (BOC)

Cofinancing agencies

Private Sector

  • Bank Polska Kasa Opieki Spółka Akcyjna (Bank Pekao S.A.)
  • Citigroup Inc.
  • Credit Suisse AG
  • ING Group N.V.
  • Powszechna Kasa Oszczędności Bank Polski Spółka Akcyjna (PKO Bank Polski S.A.) (PKOP)
  • Powszechny Zakład Ubezpieczeń Spółka Akcyjna (PZU S.A.)
  • Société Générale S.A. (SocGen or Societe Generale)
  • UniCredit S.p.A. (formerly UniCredito Italiano S.p.A.)

Receiving agencies

Private Sector

  • Żabka Polska S.A.

Loan description

Bank of China contributes to a zł2.7 billion PLN syndicated loan to finance Żabka Polska's acquisition by CVC Capital Partners in Poland 2017

Interest rate (t₀)•4.976%Interest type•Variable Interest RateMaturity•6.334 years

Narrative

Full Description

Project narrative

In April 2017, a syndicate of nine banks — including the Bank of China (BOC) — entered into a zł2.7 billion PLN syndicated loan agreement with Żabka Polska S.A. — a Poland-incorporated operator of food and convenience stores headquartered in Poznań — to finance its acquisition by Luxembourg-based private equity firm CVC Capital Partners. The loan was divided into three tranches: a zł575 million PLN tranche and a zł450 million PLN tranche, both with a maturity period of six years, a final maturity date of April 2023, and an interest rate of WIBOR plus a margin of 300 basis points (bps) and a zł1.675 billion PLN tranche with a maturity period of seven years, a final maturity date of April 2024, and an interest rate of WIBOR plus a margin of 350 bps. In addition to BOC, the following lenders contributed to the loan syndicate: ING Group N.V., Société Générale S.A. (SocGen), UniCredit S.p.A., Bank Pekao S.A., Citigroup, Credit Suisse AG, PKO Bank Polski S.A., and Powszechny Zakład Ubezpieczeń Spółka Akcyjna (PZU S.A.). ING, SocGen, and UniCredit served as underwriters. Bank Pekao, Citigroup, Credit Suisse, SocGen, and UniCredit served as bookrunners. BOC, PKOP Bank, and PZU served as mandated lead arrangers. The proceeds were to be used by the borrower to supports its leveraged buyout (LBO) by CVC Capital Partners. On February 21, 2017, Mid Europa Partners entered into an agreement with funds advised by CVC Capital Partners to sell Żabka Polska to it. Żabka Polska was the sixth largest food retailer and leading modern convenience chain in Poland with over 4,600 franchise stores in operated by 3,200 entrepreneurs. The acquisition was expected to close in the second quarter of 2017. The acquisition was completed on on April 21, 2017. The acquisition was the largest ever transaction in the Polish food retail sector and the largest ever private equity exit in Poland. After it was completed, in May 2017, the European Bank for Reconstruction and Development (EBRD) joined the acquisition of Żabka, with an equity investment of €25 million EUR. In June and 2019, Żabka was seeking to up-size the existing 2017 facility by zł1.8 billion PLN (€424 million EUR). The banks on the original loan, including BOC, were excepted by a banker familiar to join the syndicate.

Staff comments

1. The individual contributions of the nine lenders to this zł2.7 billion PLN syndicated facility are unknown. AidData has assumed each lender contributed to each tranche in this record. For the time being, AidData has estimated BOC's contribution by assuming each lender contributed equally (zł300,000,000 PLN) to the loan syndicate. 2. It is unclear whether BOC contributed to each tranche. For the time being, AidData has assumed it had, but taken the average of the maturity periods of the tranches {[(6 + 6 + 7) / 3] = 6.334 years} and the average of the reference rates {[(3.00 + 3.00 + 3.50) / 3] = 3.166%} and coded it as the maturity period and reference rate of this record. 3. AidData has assumed Żabka Polska S.A. was owned by CVC Capital Partners when the loan was made. 4. AidData estimates the interest by taking 6-month WIBOR at the time of commitment (1.81%) plus the applicable margin of 3.166%, which equals to 4.976%. For more information about WIBOR, visit https://gpwbenchmark.pl/annual.