Gunvor Group Ltd., which is among the five largest oil traders, signed two separate borrowing facilities valued at $900 million to finance its German refinery and trading operations in the Middle East.
Gunvor closed a $500 million, 360-day revolving credit facility that was placed in Germany and Austria and led by UniCredit Bank AG and Deutsche Bank AG, the company said in an e-mailed statement today. The loan will be used to provide the working capital needs of Gunvor’s refinery in Ingolstadt, Germany, which it purchased in 2012.
Gunvor, which is co-owned by billionaire Gennady Timchenko, also closed a $400 million loan that will be used to finance its Middle East trading operations, the company said in a separate statement. The facilities’ arrangers included ABN Amro Bank NV, which acted as bookrunner and lead arranger, as well as Arab Petroleum Investments Corp. and Gulf International Bank B.S.C., Gunvor said.
The financings are part of a strategy to diversify funding and follow a $299 million deal to sell receivables to GE Capital announced last month. “Instead of going for a bigger gas tank we are choosing to have a more efficient engine,” Mathieu Coolen, Gunvor’s head of structured finance, said in a telephone interview from Geneva.
Based in Cyprus with its major trading operations in Geneva, Gunvor has financing relationships with about 60 banks worldwide, Coolen said. The company, which earned a profit of $301 million from revenue of $93.1 billion in 2012, according to a bond prospectus issued in May, wants to strengthen its relationships with local lenders where it has operations, Coolen said.
Founded in 2000 to trade Russian crude oil, Gunvor opened a Middle East office in 2009 and created Dubai-based Gunvor Middle East DMCC in 2010. The company said it’s now one of the region’s main traders and wants to expand its operations and investments in the Middle East.