Olam Group’s subsidiary, Olam Food Ingredients (ofi), has secured its inaugural export credit agency (ECA) linked financing totalling some US$500 million ($664.9 million).
The facility comprises a five-year US$250 million tranche and a seven-year 37.38 billion yen (equivalent to around US$250 million) tranche.
The facility is backed by SACE, the Italian export credit agency. SACE is a joint stock company that is 100% controlled by Italy’s ministry of economy and finance.
“This is a landmark facility – being ofi’s first ECA backed loan and SACE’s first ‘Samurai’ Japanese yen (JPY) loan. This transaction forms a part of our financing strategy to diversify sources of capital and extend our debt maturity. We are pleased to support SACE’s ‘Push Strategy1’ and look forward to enhancing our engagement with Italian customers and suppliers,” says Rishi Kalra, executive director and group CFO of ofi.
The facility will be initially guaranteed by the Olam Group VC2 . This will be transferred to ofi group after its planned initial public offering (IPO) and after the demerger of ofi. The facility’s proceeds will be used for general corporate purposes.
Sumitomo Mitsui Banking Corporation (SMBC) acted as a mandated lead arranger and bookrunner while Citibank acted as a mandated lead arranger for the facility. SMBC was also appointed as a coordinator and facility agent.
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Shares in Olam closed at $1.05 on March 11.
