ICBC contributes to $6 billion loan to Equate Petrochemical for the acquisition of ME Global, refinancing, and general corporate purposes (Linked to Record ID#98923)

Project narrative

In December, 2015, Industrial and Commercial Bank of China (ICBC) contributed an estimated $428.57 million to a $6 billion dual-tranche acquisition financing bridge loan to the Kuwait-based Equate Petrochemical. The loan funded Equate's $3.2 billion acquisition of ME Global, refinanced previous loans, and provided for general corporate purposes. The loan had a maturity of one year with a possible 6-month extension and an unknown but tight interest rate. The loan was split into a $5.5 billion conventional debt facility and a $500 million Murabaha Islamic facility, which reportedly had a relatively lower margin rate at around 60bps (0.6%). Both facilities were unsecured and refinanced in July, 2016 (Record ID#98923). Fourteen (14) institutions participated in the lending syndicate. Citibank, HSBC, JP Morgan, National Bank of Kuwait (NBK), and Kuwait Finance House (KFH) acted as global coordinators and mandated lead arrangers (MLAs). Intesa Sanpaolo, Mizuho, MUFG, Sumitomo Mitsui Banking Corporation (SMBC), and National Bank of Abu Dhabi (NBA) acted as mandated lead arrangers (MLAs). ING Bank, Industrial and Commercial Bank of China (ICBC), Export Development Canada (EDC), and Commercial Bank of Kuwait (CBK) acted as lead arrangers. Syndication was broken down into two stages, where a smaller group of relationship banks of Equate, ME Global, Dow and PIC/ KPC was initially brought in to participate with the deal, after which a broader group of banks were then brought into the transaction. Regional banks accounted for 30% of the liquidity used in the transaction while international lenders accounted for 70%. The facility was oversubscribed by US$3.5bn. The loan was the largest acquisition financing deal in Kuwait before 2015. MEGlobal is headquartered in Dubai and produces 1 million tons a year of ethylene glycol in Canada.