OAO Rosneft, Russia’s largest oil company, began to receive responses from banks as it seeks to raise about $32.5 billion of loans to fund its acquisition of TNK-BP, according to four people with knowledge of the deal.
Banks have each been asked to commit $1.75 billion to a two-year bridge loan of as much as $24.5 billion and $500 million to a $8 billion, five-year facility, said the people, who asked not to be identified because the terms are private. As many as 15 non-Russian lenders are expected to commit to the state-run firm’s request, said the people.
The Moscow-based energy company plants to get banks to sign initial terms on the deal by the end of the year and for the transaction to be completed in the first quarter of 2013, the people said.
A Rosneft press official, who asked not to be identified, citing company policy, declined to comment on the deal.
Rosneft is to pay about $55 billion for TNK-BP after agreeing to buy stakes held by BP Plc and a consortium of billionaires known as AAR. Rosneft has offered BP $17.1 billion in cash and 12.8 percent of its stock while AAR is set to receive $28 billion in cash, it said Oct. 22. The Rosneft board approved the deal earlier today.
Russia-based banks will provide additional funding to help raise remaining cash for the bid, the people said.
Rosneft plans to replace about 70 percent of the bridge loan with bonds and the rest with longer-term loans, two of the people said. The shorter loan is structured so it reduces by 40 percent after the first year, the two people said.