ICBC London and Bank of China contribute to $600 million pre-export finance (PxF) facility to refinance KAZ Minerals' existing PxF

On June 9, 2017, KAZ Minerals PLC announced that it had entered into a $600 million USD pre-export finance (PXF) loan facility with a syndicate of 12 banks — including Bank of China (BOC) and ICBC London (a wholly-owned subsidiary of the Industrial and Commercial Bank of China) — to refinance an existing PXF facility. The new PXF extended the maturity profile of an existing pre-export finance facility by 2.5 years from December 2018 until June 2021. Under the revised repayment profile, principal repayments would commence in July 2018 and then continue in equal monthly installments over a three-year period until final maturity in June 2021. The interest basis of the new PXF was substantially the same as the existing facility, with a variable margin between 3.0% and 4.5% above USD LIBOR, dependent on the ratio of net debt to EBITDA1 which, was tested semi-annually. The financial covenants were revised in the new PXF to increase headroom as KAZ Minerals' new mines at Bozshakol and Aktogay began to ramp up production, as KAZ Minerals remained subject to temporary restrictions relating to its total debt, dividends, acquisitions and capital expenditure outside the scope of existing operating mines and major growth projects for as long as the net debt-to-EBITDA ratio remained above 3.5:1. In addition to BOC and ICBC London, the following institutions contributed to the syndicated facility: ABN AMRO Bank N.V., Citibank N.A., Crédit Agricole Corporate and Investment Bank, JP Morgan Chase Bank N.A., Natixis, Rabobank London, UniCredit S.p.A., Deutsche Bank AG, ING Bank N.B., and Société Générale Corporate and Investment Banking (SGCIB). The refinancing was coordinated by Deutsche Bank AG. ING Bank and Société Générale Corporate and Investment Banking acted as Coordinating Mandated Lead Arrangers and Bookrunners. Deutsche Bank AG served as the agent bank and ING Bank was the security trustee. The balance of the $600 million USD in commitments, over the $224 million USD outstanding under the existing PXF as on May 31, 2017, was available for drawing over a six-month availability period until December 2017. In January 2020, this PXF was refinanced by a new $1 billion PXF, with a maturity length increase and interest rate cut. BOC and ICBC London served as Mandated Lead Arrangers of that loan.

Additional details

1. AidData has coded this transaction as a collateralized loan because ING Bank N.V. acted as the security trustee (i.e. collateral agent) for the loan. When lenders take collateral as security for their loans, a collateral agent/security trustee is often appointed to enforce rights against the collateral in the event of the borrower's default under the loan. 2. The individual contributions of the 12 lenders to this $600 million USD syndicated PXF loan are unknown. For the time being, AidData has estimated the collective contributions ($100,000,000 USD) of BOC and ICBC London by assuming that the 12 lenders each contributed equal amounts ($50,000,000 USD) to the loan syndicate. 3. For the time being, AidData has estimated the all-in interest rate (5.182%) by adding average 6-month LIBOR in June 2017 (1.432%) to the midpoint of the 3%-4.5% margin range (3.75%).

Number of official sources

3

Number of total sources

5