OAO Uralkali (URKA), the largest potash producer by output, received more than $1 billion of commitments from lenders for a five-year loan it’s seeking, according to three people with knowledge of the deal.
The company is offering to pay an interest margin of about 215 basis points more than the London interbank offered rate, said the people, who asked not to be identified because the terms are private. A basis point is 0.01 percentage point.
The pre-export financing, where debt is backed by cash flows linked to the borrower’s export contracts, is being syndicated on a so-called club basis with Bank of America Corp. helping to coordinate the facility, the people said. The minimum commitment size is $50 million, they said.
Olga Ilyina, a Moscow-based spokeswoman for Uralkali, declined to comment on the financing.
The Berezniki, Russia-based company borrowed $205 million from banks in August 2012 with a five-year loan paying a margin of 250 basis points more than Libor, according to data compiled by Bloomberg.
Uralkali, controlled by a group of billionaires including Suleiman Kerimov, is rated Baa3 by Moody’s Investors Service and an equivalent BBB- by Standard & Poor’s and Fitch Ratings, the lowest investment-grade rank, the data show.
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