Friday 29 Mar 2024
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KUALA LUMPUR (Apr 8): Malaysia Airports Holdings Bhd (MAHB) announced today that the syndication of a €500 million (RM1.974 billion) bank facility loan undertaken by its wholly-owned subsidiary Istanbul Sabiha Gökçen Uluslararasi Havalimani Yatirim Yapim ve Isletme A.S (ISG) has been completed.

In a statement, MAHB (fundamental: 0.5; valuation: 0.6) said the senior secured syndicated term loan facility is guaranteed by ISG’s shareholders and MAHB group.

The facility was pre-funded and fully underwritten by BNP Paribas Fortis SA/NV, CIMB Bank Bhd’s Labuan Offshore Branch and Deutsche Bank AG’s Singapore branch, which is the facility agent.

The final breakdown of lenders consists of a range of banks from various countries including Malaysia, Belgium, Singapore, Turkey, London, Germany, and Taiwan, among others.

MAHB said syndication of the loan facility, launched on Jan 20, 2015, had received a strong and positive response from 19 banks covering Europe, Middle East and Asia.

“The syndication recorded oversubscription and total firm commitments of approximately €1 billion,” the statement read.

“Such strong response during syndication enabled MAHB to successfully reduce the margin on the facility from 2.75% per annum (p.a.) over Euro Interbank Offered Rate (Euribor) to 2.5% p.a. over Euribor through the reverse flex structure (interest margin reduction mechanism), a testament to the strong demand for MAHB’s and ISG’s credit.

MAHB said the term loan was funded on Dec 24, 2014, just a week before the 100% acquisition of ISG by MAHB on Dec 31, 2014 with the objective of reducing the cost of funding for ISG.

It said the proceeds from the facility were utilised for the refinancing of the borrower’s existing borrowings, working capital requirements and general corporate purposes.  

MAHB also said the term loan facility is the first reverse-flex exercise by a corporate borrower outside of the United States.

The company said its effort in pushing for reverse-flex structure has received compliments from the International Financing Review, one of the world's leading provider of global capital market intelligence.

The international organisation had said that despite the lack of international borrowings, MAHB is well versed with the intricacies of the market as it pushes for the reverse-flex structure, despite its rarity in global debt market.

(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)

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