SAUDI ARABIA
The Deal: SABIC’s $3.5bn project financing
ABN AMRO was financial adviser and mandated lead arranger along with Samba Financial Group and Standard Chartered Bank. Other mandated lead arrangers were Saudi Hollandi Bank, Arab Banking Corporation, Arab Petroleum Investments Corporation, BNP Paribas, Citibank, Fortis Bank, Gulf International Bank, ING Bank, Islamic Development Bank, Mizuho Corporate Bank, Sumitomo Mitsui Banking Corporation, The Bank of Tokyo-Mitsubishi UFJ and The Saudi British Bank. Banque Saudi Fransi, The National Commercial Bank and Arab Bank were senior lead arranger.
The transaction represents Saudi Basic Industries Corporation’s first true project financing, Saudi Arabia’s largest greenfield project financing to date, the biggest single bank project debt underwriting in Middle East and north Africa and one of the largest Islamic tranches ($847m) in any multi-sourced financing.
SERBIA
The Deal: Telenor’s €1.51bn acquisition of Mobi 63
Rothschild advised the vendor, the Serbian government; Citi and Citadel Investment Group advised Mobi 63 while BNP Paribas advised Telenor.
Founded by the Serbian government in mid-2006 to take over activities of troubled mobile operator Mobtel, Mobi 63 received a great deal of sector interest when put up for sale. The initial minimum deal value of €800m set by the government was nearly doubled by Telenor’s offer, making it the largest ever transaction in Serbia. The transaction was executed in a short period of time, particularly considering the complexity of dealing with the Serbian government and a minority shareholders in Mobi 63 at the same time.
SINGAPORE
The Deal: Standard Chartered’s $1.5bn Start III CLO
Lehman Brothers and Standard Chartered were co-arrangers, joint lead managers and bookrunners.
A rare and innovative public synthetic securitisation, Standard Chartered’s collateralised debt obligation (CLO) is a landmark transaction that leads the way for Basel II balance sheet deals in Asia. The deal securitises purely Asian and Middle Eastern loan risk and references a portfolio from primarily the local corporate segment of Standard Chartered Bank. The CLO generated strong appetite across the full capital structure and provided the issuer with capacity for continued growth, improved liquidity in its balance sheet and capital efficiency.
SOUTH KOREA
The Deal: Lotte Shopping’s $3.7bn dual IPO
Goldman Sachs and Nomura were joint global co-ordinators and joint bookrunners.
Listed on the Korea Exchange and on the London Stock Exchange, this is the largest ever retail equity offering globally and the largest ever non-privatisation IPO in Asia. The deal also breaks some domestic records: it is the largest ever Korean equity offering and the largest ever Korean domestic IPO. The listing was successfully completed despite volatile markets. A comprehensive institutional marketing campaign helped to price the deal at the top half of the price range.
SPAIN
The Deal: Bolsas y Mercados Españoles’ €779m IPO
BBVA, BNP Paribas, Merrill Lynch, Morgan Stanley and Grupo Santander were joint bookrunners.
The IPO of Spain’s stock exchange is not only a large and complex transaction, but the deal also successfully took place in difficult market conditions, when other European exchanges were underperforming. Concerns over the Markets in Financial Instruments Directive (MiFID) regulations and constraints related to specific Spanish legislation were overcome by a successful marketing campaign. The issue price was in the top half of the price range, at a level twice as high as the level at which shares were traded in the previous year among strategic investors. Investors’ demand covered more than five times the order book, with interest in all the offering segments.SWEDENThe Deal: Opica’s €2.7m acquisition of Capio Deutsche Bank was sole financial adviser to Nordic Capital, part of Opica, and joint adviser to Opica. ABN AMRO and Rothschild also advised Opica; Morgan Stanley advised Capio.Opica, a consortium formed by Apax Partners and Nordic Capital, displayed high level tactics in this unsolicited acquisition of Capio Healthcare. The deal also proves the exceptional power that private equity groups have when it comes to raising finance for their takeovers.SWITZERLANDThe Deal: Swiss Re’s $750m perpetual subordinated financing (Yankee Tier 1) and SFr1.3bn rights issue and global offeringBank of America, Dresdner Kleinwort, HSBC, JPMorgan and UBS were joint bookrunners and mandated lead arrangers on the subordinated financing; ABN AMRO, Citi, Deutsche Bank and Merrill Lynch were co-lead managers on the financing. BNP Paribas, Credit Suisse and UBS were joint bookrunners and joint lead managers on the rights issue; Calyon, Fox-Pitt Kelton and Lehman Brothers were co-lead managers on the rights issue.This is a very complex structure for the perpetual subordinated financing that, along with the rights issue, was a high-quality solution to Swiss Re’s financial requirements.SYRIAThe Deal: CNPC International and OVL’s €484m joint acquisition of Petro-Canada’s Syrian assetsCiti was the financial adviser to CNPC International and ONGC Videsh (OVL) on the joint acquisition. Harrison Lovegrove advised the target.This is the first ever joint cross-border acquisition of upstream oil and gas assets by a Sino-Indian consortium. Citi brought together CNPC International (an arm of China National Petroleum Corporation) and OVL (a subsidiary of India’s state-owned Oil and Natural Gas Corporation) and structured the joint bid in a highly competitive environment. The landmark transaction will allow the two companies to share equal ownership (50/50) of Petro-Canada’s stake in Syrian assets jointly owned with Shell. The deal significantly increased the joint venture’s political clout with the Syrian government and provided the opportunity to jointly acquire Shell’s stake in the assets in the future.TAIWANThe Deal: T$32bn financing for Eastern Multimedia Company’s LBOChinatrust, Citi and Taipei Fubon Bank were joint lead arrangers.The deal is a landmark LBO financing, structured for the acquisition of Eastern Multimedia Company by Carlyle Group. The transaction is symbolic in the Taiwan acquisition financing and is the largest LBO financing in the media sector in the Asia-Pacific region. Despite the high leverage ratio of 6.75 times the debt-to-EBITDA ratio – the highest across Asia-Pacific at that time – the lead arrangers were able to close the deal without the need to go for general syndication, and generated commitments for one-and-a-half times the target amount in two months.TANZANIAThe Deal: Celtel Tanzania’s $75m syndicated credit facilityStandard Bank was the global arranger; Stanbic Bank and CRDB Bank in Tanzania acted as local arrangers. In June 2006, cellular network operator Celtel Tanzania secured $75m in funding from a syndicate of eight banks, the largest ever locally arranged loan to be agreed in the country. The eight-bank syndicate included the Development Bank of Southern Africa and FMO, the Dutch development finance institution. It is the first time that foreign development finance institutions have provided funding in Tanzanian shillings. Of the $75m, $17.5m will be disbursed in US dollars while the balance will be in Tanzanian shillings.THAILANDThe Deal: TMB Bank’s $200m hybrid Tier 1 issueBarclays Capital and DBS were joint bookrunners and joint lead managers. This is the first hybrid Tier 1 issue out of Thailand following new regulation on hybrid rules that were passed by the Thai central bank last year. After a successful roadshow, the deal was more than two times oversubscribed and attracted about $380m of orders from quality investors from the major financial centres in Asia and Europe. The success of the transaction is even more remarkable given the volatile conditions of the bond market during the marketing campaign, in addition to Thailand’s political instability.TRINIDAD AND TOBAGOThe Deal: Urban Development Corporation of Trinidad and Tobago’s $176m short-term financing facilityFirst Caribbean was sole arranger and underwriter. The facility has financed the construction and management of the International Waterfront Project, a landmark project for the government of Trinidad and Tobago, and represents one of the largest US dollar transactions undertaken by the government. The transaction is noteworthy not only for its size, but also for the speed of execution. In only three weeks, the facility was able to disburse funds, which supported the Urban Development Corporation’s commitments to the other parties involved in the project.TUNISIAThe Deal: PA Resources’ $230m acquisition of MP Zarat’s Tunisian offshore oil and gas assets Arab Banking Corporation acted as adviser to PA Resources.Early last year, Sweden’s PA Resources completed the acquisition of Tunisian offshore oil and gas assets of MP Zarat. PA Resources paid $230m for the 78.8% stake. The balance is already owned by PA Resources in the producing field Didon and a further additional interest in the Zarat Permit. The Didon field is estimated to have reserves of 100 million barrels with a recovery factor of 40%. TURKEYThe Deal: National Bank of Greece’s $5.5bn acquisition of a controlling stake in Finansbank Credit Suisse acted as adviser to NBG and as joint bookrunner with Citi and Goldman Sachs. Deutsche Bank and JPMorgan acted as co-lead managers. The transaction represents an unprecedented alliance of a Greek bank and a Turkish bank. The total acquisition price of $5.5bn was financed primarily by a €3bn rights issue that formed the cornerstone of the takeover of Finansbank and represented the largest ever equity issue by a Greek company. UKRAINEThe Deal: Severny Gok and Centalny Gok’s $400m structured pre-export term loan trade financingBNP Paribas was sole bookrunner, underwriter and mandated lead arranger.This interesting transaction for two iron ore and iron pellet mining companies worked around the criteria of an export finance facility, whereby the lender exports the production. The deal was structured as a derivative of a traditional pre-export facility because the borrowers do not carry out the export function. As a result, the transaction benefits from the assignment of two sets of contracts: a delivery contract with the exporter and an export contract under which an offtaker is obliged to buy the steel from the exporter. The response to the transaction from the bank market was outstanding with the syndication attracting an oversubscription of more than 50%.UNITED KINGDOMThe Deal: Grupo Ferrovial’s €16.4bn acquisition of BAA and €9.32bn acquisition financingLazard, Rothschild and UBS advisedBAA; UBS and ABN AMRO were BAA’s joint brokers. Citi, HSBC and Macquarie advised Grupo Ferrovial; Royal Bank of Scotland was mandated lead arranger and bookrunner on the financing facility. This was the largest UK takeover in 2006 and the largest completed European M&A deal in 2006. The financing was the largest infrastructure acquisition financing ever undertaken in the debt markets.UNITED STATESThe Deal: Hercules Holding II’s $33bn LBO of HCAMerrill Lynch, Bank of America, Citi and JPMorgan advised Hercules Holding II, a consortium formed by Bain Capital, Kohlberg Kravis Roberts and Merrill Lynch Global Private Equity; Credit Suisse and Morgan Stanley advised HCA Healthcare; Merrill Lynch, Bank of America, Citi and JPMorgan were joint lead arrangers on the $16.8bn senior secured credit facility and joint bookrunners on the $5.7bn second lien bridge/notes alongside Deutsche Bank and Wachovia. The buyout was the world’s largest LBO and a milestone in the private equity sector, marking the power and ambition of the sector and potentially setting the stage for other even larger transactions. The LBO financing included the largest leveraged loan ever syndicated and one of the largest high yield bond offerings in history.URUGUAYThe Deal: Republica Oriental del Uruguay’s 9.56bn pesos 5% bond due 2018Citi and Deutsche Bank were joint lead managers.The 12-year inflation-indexed, $400m equivalent bond issue represents a landmark transaction for Uruguay. It is the largest and longest dated international local currency-denominated bond in the country, which generated a high quality order book from both local and international investors. The 5% coupon is less than half the coupon of a three-year bond and highlights the soundness of Uruguay’s economic fundamentals.VENEZUELAThe Deal: Siderúrgica del Turbio’s $100m 10% bond due 2016Deutsche Bank was sole bookrunner.Last year came the second international capital markets offering from a Venezuelan corporate since the introduction of tighter capital controls in 2003. The improving credit history of Siderúrgica del Turbio attracted a broad pool of investor types and geographies and generated an order book that was two-and-a-half times oversubscribed. The deal also had a very good performance on the secondary market, trading up almost a point in it.VIETNAMThe Deal: Electricity of Vietnam’s VND1000bn senior unsecured notes due 2006Deutsche Bank advised Electricity of Vietnam on the issue; Vina Capital also provided advice and Anbinh Bank was the deal’s arranger and issuing and settlement agent.Electricity of Vietnam priced the country’s first public corporate bond issued onshore but to be placed mainly with foreign investors. The transaction was a first in size and tenure, becoming the local market’s 10-year benchmark bond. Investor interest was reflected in a three-times-oversubscribed book, which closed in two hours at a very tight pricing. The notes will pay 9.6% in the first year and 9.95% thereafter.YEMENThe Deal: SabaFon’s $42m export credit agency supported financingHSBC Amanah was mandated lead arranger and sole lender.HSBC worked closely with Germany’s export credit agency (ECA), Euler Hermes, and Siemens to structure an attractive package of sharia-compliant financing for SabaFon, Yemen’s leading mobile telecommunications provider. The deal was one of the first ever ECA-supported transactions structured in compliance with Islamic law and was extended on the basis of SabaFon corporate risk. The five-year facility was documented as a murabaha facility governed by English law, supported by promissory notes governed by Yemeni law.ZAMBIAThe Deal: Equinox Minerals’ $584m financing for the Lumwana copper projectStandard Bank, Standard Chartered Bank and WestLB were lead arrangers.The Lumwana copper project is notable both for its size (a total of $900m) and its innovative and complex structuring. Sourced from a wide spectrum of lenders, the deal has 15 different facilities linked via common financing terms and involving different classes of capital. The $584m financing structure includes senior secured debt, senior unsecured debt, subordinated debt, partially guaranteed debt, political risk covered debt, ECA-backed financing and asset financing. Copper mining is not new to Zambia, but the Lumwana mine is the largest mine development in Africa and one of the largest copper mines under construction globally. Moreover, Australian Equinox Minerals is a junior in global mining terms and until recently was focused only on exploration.
