Glencore Xstrata Said to Raise More Than $19 Billion for LoanStephen Morris
Glencore Xstrata Plc, the biggest publicly-traded commodity supplier, raised more than $19 billion to replace credit lines after completing its takeover of Xstrata Plc, according to two people with knowledge of the matter.
More than 80 lenders committed funds to the deal, including 29 providing $500 million each, said the people, who asked not to be identified because the terms are private. The loan may be finalized this month.
The Baar, Switzerland-based company sought to replace debt including $12.8 billion of credit facilities obtained before the merger. Glencore concluded its all-share $29 billion merger with Xstrata last month to add coal, copper, zinc and nickel mines to its trading operations.
The revolving credit facilities, where money repaid can be borrowed again, comprise one-, three- and five-year portions that pay initial interest margins from 80 basis points, or 0.8 percentage points, to 90 basis points more than the London interbank offered rate, according to data compiled by Bloomberg. Fees paid to draw on the credit lines range from zero on the one-year portion to 75 basis points on a five-year deal, dependent upon their use.
A spokesman for Glencore declined to comment on the financing.
Banks participating as mandated lead arrangers will have their commitments reduced to $450 million when the facility is finalized, said the people. Other lenders had the option of committing smaller amounts.
Royal Bank of Scotland Group Plc is coordinating the loan, with Banco Santander SA, Barclays Plc, Commerzbank AG and Societe Generale SA also helping to arrange the debt, Bloomberg data show.