Narrative
Full Description
Project narrative
On August 23, 2021, financial close was reached on a deal in which a syndicate of six international banks — including the Bank of China (BOC), China Everbright Bank, and Tai Fung Bank Limited — entered into a $333 million USD syndicated term cash advance facility agreement with Yancoal Australia Limited — an Australia-incorporated coal mining company majority owned by Yanzhou Coal Mining — for the Yancoal Australia 2021 Refinancing Project. The proceeds of this loan carried a maturity period of five years and a grace period of three years; $301 million USD was due for repayment on August 23, 2024 and $32 million USD was due on August 21, 2026. This loan carried an interest rate based on USD LIBOR plus an unspecified margin. This loan was secured by (i.e. collateralized against) the assets of the aggregated group of Yancoal Resources Pty Ltd (formerly Yancoal Resources Limited) and Coal & Allied Industries Limited with an asset carrying value of $7.392 billion AUD. It included financial covenants based on the aggregate results of Yancoal Resources and Coal & Allied, namely: an interest cover ratio greater than 5.0 times; a finance debt to EBITA ratio less than 3.0 times; and net tangible assets greater than $1.5 billion AUD. As of December 31, 2021, this loan had been fully disbursed. The proceeds of this loan were to be used by the borrower to refinance its existing debts; specifically, repay a $300 million USD ($419 million AUD) syndicated term loan. Record ID#97164 captures BOC's contribution. Record ID#97165 captures China Everbright's contribution. Record ID#97166 captures Tai Fung Bank's contribution. In addition to the three Chinese state-owned banks, the following lenders contributed: Citigroup, Ping An Commercial Bank, and State Bank of India (SBI). BOC and Citigroup served as the lead banks, while the other four joined in syndication. The loan was launched in early April 2021 with a $400 million USD target. However, it took five months to close and only attracted four banks during syndication — perceived by analysts to be a sign of poor prospects for the coal sector.
Staff comments
1. Yankuang Energy Group Company Limited (formerly known as Yanzhou Coal Mining Company Limited) is a Chinese state-owned company and a subsidiary of Shandong Energy Group Co. Yankuang Energy Group Company Limited is the ultimate parent of Yancoal Australia Ltd. via Yanzhou Coal Mining Company Limited, the PRC-incorporated joint stock limited coal mining company. 2. The individual contribution of the six lenders to this $333 million USD syndicated loan is unknown. For the time being, AidData has estimated the contribution of BOC, China Everbright, and Tai Fung by assuming that each lender contributed an equal amount ($55,500,000 USD) to the syndicated loan.