(14 May 2008) BW Group Limited has executed a five-year USD 3 billion facility agreement with a consortium of 11 banks. The banks, acting as mandated lead arrangers, committed a total sum of USD 5 billion against the BW Group's requirement of USD 3 billion.
The BW Group will use the facility to refinance debt incurred by BW Gas ASA and BW Offshore Limited.
"The BW Group has grown significantly in recent years and the size and terms of this loan, completed during challenging times in the credit markets, reflect the strength of the group and the good reputation we have with our banks," says Dr Helmut Sohmen, BW Group Chairman.
Clarence Lui, CFO, BW Shipping, adds: "This financing model allows the BW Group and its subsidiaries to draw on the consolidated strength of the group for more cost-effective financing."
BW Gas ASA will receive a USD 1.5 billion five-year unsecured revolving credit facility from the BW Group. The purpose of this loan is to refinance the company’s existing USD 1.5 billion unsecured revolving credit facility. An immediate effect of the refinancing will be a removal of the waivers on the equity covenants in the existing loan agreement, which were granted by external lenders following the Norwegian government’s decision to back tax shipping companies.
BW Offshore Limited will also receive a USD 1.5 billion five-year revolving credit facility to refinance its current credit facilities and to fund new Floating Production, Storage and Offloading (FPSO) projects.
The terms and conditions of the two credit facilities have been granted on an arm’s length basis, and after due consideration by the independent directors of BW Gas and BW Offshore were determined to be competitive compared to offers received directly from third party lenders.
Nordea Bank Norge ASA (“Nordea”), DnB NOR Bank ASA Singapore Branch (“DnB”), ING Bank N.V. Singapore Branch (“ING”), Handelsbanken Norwegian Branch of Svenska Handelsbanken AB (PUBL), Swedbank AB (PUBL), HSH Nordbank AG Singapore Branch, Danske Bank A/S, Fortis Bank S.A./N.V. Singapore Branch, Oversea-Chinese Banking Corporation Limited, Deutsche Bank AG Filiale Deutschlandgeschäft, and HSBC Bank plc act as mandated lead arrangers and underwriters. The bookrunners of the facility are Nordea, DnB and ING, with Nordea also acting as facility agent.