Bashneft has successfully closed a US$ 500 million financing transaction led by Société Générale and PJSC Rosbank (together, the ‘Société Générale Group’) and Vitol S.A (‘Vitol’) and involving leading Chinese banks: Bank of China and ICBC. Financing shall be provided in the form of prepayment under a long-term contract for the supply of crude oil and petroleum products. The transaction had been approved by Bashneft’s Board of Directors.
The financing facility has a five-year tenor and is secured by a long-term offtake contract between Bashneft and Vitol. The Company plans to use the entire sum of the proceeds to fund its general corporate purposes.
‘Financial and commercial terms of this transaction are consistent with the Company’s strategy and our plans for funding of the 2016 investment programme; they reflect risks associated with the current and expected high volatility in the energy and currency markets,’ said Alexey Lisovenko, Bashneft’s Vice President for Economics and Finance and Chief Financial Officer.
This transaction is PJSOC Bashneft’s first deal aimed at raising funds from Chinese lending institutions. It has allowed Bashneft to expand the range of its partner banks and to start the development of promising cooperation with financial institutions from China.
Société Générale Group was appointed as Initial Mandated Lead Arranger, Bookrunner, Coordinating Bank and Joint Documentation Agent (together with Bank of China (UK) Limited). Moreover, Société Générale also acted as the Security Agent and Facility Agent, while PJSC Rosbank acted as the Passport Bank. In addition, Bank of China (UK) Limited was appointed as Initial Mandated Lead Arranger, while ICBC (Europe) S.A. acted as the Initial Mandated Lead Arranger and Publicity Agent.