BB Energy Increases Loan on Demand for Commodity Trader Debt

B.B. Energy Holdings NV, a closely-held oil trader, increased its first unsecured credit line to $125 million, taking advantage of banks’ willingness to commit funds to the sector.

“The appetite from banks to lend to traders is there, including from banks that are not historically trade-finance providers,” Riccardo Greco, BB Energy’s London-based chief financial officer, said in a telephone interview. The loan can be used by any of the group’s trading offices, he said.

The one-year revolving credit facility, which includes a 12-month extension option, is the company’s inaugural corporate facility, BB Energy said in a June 27 statement. Arranged by BNP Paribas SA, Natixis SA, Rabobank International and Standard Chartered Plc, the deal attracted a total of 17 lenders and increased from $100 million, it said.

Commodity traders have raised at least $35 billion of revolving credit facilities since December, including a $17.3 billion deal for Glencore Xstrata Plc, the largest European syndicated loan this year, according to data compiled by Bloomberg. Trading companies generate lucrative ancillary business for lenders due to their global operations and high liquidity needs, bankers said last month.

BB Energy, founded in Lebanon in 1937, traded 11.2 million tons of crude oil and petroleum products in 2012, generating revenue of $10.5 billion. The loan is a “milestone” for the company, reflecting its increased size, Greco said.

The company has more than $3 billion of trade finance facilities including a $400 million loan funding its oil product supplies into Mauritania, according to the statement.

(Updates with loan details in sixth paragraph.)
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