Bank of China contributes EUR 100 million to EUR 1.05 billion syndicated loan for Bright Food Group's acquisition of a 76.7331% stake in Tnuva

On March 18, 2015, Bright Food Group Co., a Chinese state-owned enterprise (SOE), signed a EUR 1.05 billion syndicated loan agreement with a group of 10 banks to facilitate its acquisition of a 76.7331% (controlling) stake in Tnuva Food Industries, Agricultural Co-Operative Association in Israel Ltd. and Tnuva Central Co-Operative for the Marketing of Agricultural Produce in Israel Ltd., an Israeli food (production, distribution, and marketing) company. The Bank of China (BOC) Shanghai Branch was the lead arranger and contributed EUR 100 million to the syndicate loan. The other lenders provided the remaining EUR 905 million. The other lenders were HSBC, JPMorgan Chase & Co., Hang Seng Bank Limited, the Royal Bank of Scotland (RBS), ING Group N.V., Rabobank, Standard Chartered PLC, BNP Paribas S.A., and Barclays Bank Plc. The borrowing terms of the loan are unknown. However, it is known that EUR 600 millionwas provided in the form of a term loan and EUR 450 million was provided in the form a bridge loan. The EUR 600 million term loan was guaranteed by Bright Food and had a maturity date of March 18, 2018. The Bright Food Group began seeking a syndicated loan to finance the acquisition of a majority share in Tnuva in May 2014, albeit only for the euro equivalent of USD 800 million. Bright Food had announced a preliminary deal with British private equity house Apax Partners LLP (APAX.UL), the majority owner of Tnuva, for Bright Food's acquisition of a 56% stake on May 22, 2014. At this time, negotiations were still ongoing with Israeli firm Mivtach Shamir Holdings, which held a 21% stake in Tnuva and had the right to sell its stake together with Apax. Bright Food considered bringing in Chinese state-supported private equity firm Sailing Capital Management as a partner to buy Mivtach's stake before to securing the syndicated loan. On March 31, 2015, Bright Food Group's officially acquired 76.7331% equity in Tnuva. The acquisition was especially notable because Tnuva was, at the time, Israel's largest food company, and the acquisition itself was largest in the history of the Israeli food industry. The acquisition gave Bright Food, a major dairy producer, access to new production technology and products.

Additional details

1. The Chinese project title is 收购以色列马克西姆农药项目 or 代表进出口银行关于16.8亿美元银团贷款给中国化工农化总公司用于收购一家以色列上市公司的融资项目. 2. Tnuva, or Tenuvah, (Hebrew: תנובה‎, fruit or produce) was an Israeli food processing cooperative (co-op) owned by the kibbutzim (collective farms) and moshavim (agricultural communities) that historically specialized in milk and dairy products. Tnuva is the largest food manufacturer in Israel; its sales account for 70% of the country's dairy market as well as sales of meat, eggs and packaged food (see "Chinese state company buys controlling stake in Tnuva"; "Tnuva"; and pg.257 of "Bright Food (Group) Co., Ltd. Prospectus for the tenth issue of ultra-short-term financing bonds in 2016( 光明食品（集团）有限公司 2016 年度第十期超短期融资券募集说明书"). 3. While a specific maturity date is known (March 18, 2018), it is only known for the €600 million EUR was provided in the form of a term loan, and there is no specific breakdown of the BOC's contribution to that loan (there is only broad knowledge of BOC's €100 million EUR contribution to the entire syndicated loan). To avoid coding a wrong maturity period (as the €450 million EUR may have a different maturity) AidData has not coded a maturity period. However, since a guarantee was provided for at least the term loan (it is not clear if the bridge loan received the loan), AidData has left Bright Food as an accountable agency (see pg.67 and 73 of "Bright Food Singapore Holdings Pte. Ltd. Offering Circular dated 12 July 2017").

Number of official sources

5

Number of total sources

16