Saudi Arabia’s Tasnee Said to Suspend Payment on $1 Billion Loanby
Industrial company said to get six-month deferral on payments
Tasnee said to agree suspension before October installment
Saudi Arabia’s National Industrialization Co. suspended repayments on a 4 billion-riyal ($1.1 billion) loan while it holds refinancing talks, according to three people with knowledge of the matter.
The industrial and manufacturing holding company received a six-month payment holiday from lenders before an installment was due at the beginning of October, the people said, asking not to be identified as the information is private. Tasnee has been hit by a slump in chemicals prices and may seek to extend the length of the debt, which is due in 2021, the people said.
The loan was provided by banks including Samba Financial Group, Saudi British Bank and Riyad Bank in 2013, according to data compiled by Bloomberg.
It’s the second time this year the company has sought to renegotiate debt, after earlier this month agreeing to refinance about 7 billion riyals at its titanium dioxide unit, known as Cristal. Tasnee started talks with lenders to refinance the debt in March because of a slump in commodity prices and falling profit, people familiar with the matter said at the time.
Tasnee and rival Saudi petrochemicals companies including Saudi Kayan Petrochemicals Co., Rabigh Refining & Petrochemicals Co., and Methanol Chemicals Co., reported a loss last year. The company returned to profit in the three months through June -- after five consecutive quarters of declines -- as titanium dioxide prices began to recover and costs fell.
Officials at Tasnee, based in Riyadh, didn’t immediately respond to requests to comment.