Gazprom neft has signed a $2.15 billion club term facility agreement

03 December 2013

Gazprom neft has signed a $2.15 billion club term facility agreement with a group of international banks.

The facility is an amortizing* $2.15 billion term loan with a final maturity date falling five years from the date of the first utilization and a two-years grace period. The facility has a six-month drawdown period from the signing date.

The interest rate under the facility is the sum of LIBOR and 1.50% per annum. Funds are provided on an unsecured basis and shall be used for general corporate purposes in 2014.

Utilizations under the facility are subject to the approval of the company’s Board of Directors and are expected no earlier than in 2014.

The agreement was signed with Bank of America Merrill Lynch, Barclays Bank PLC, Bayerische Landesbank, Commerzbank Aktiengesellschaft / Commerzbank Aktiengesellschaft, Filiale Luxemburg, Crédit Agricole Corporate and Investment Bank, Deutsche Bank Luxembourg S.A., ING Bank N.V., Intesa Sanpaolo Bank Ireland plc, Mizuho Bank Nederland N.V., Societe Generale, Sumitomo Mitsui Banking Corporation Europe Limited /Sumitomo Mitsui Finance Dublin Limited, The Bank of Tokyo-Mitsubishi UFJ, Ltd. / BTMU (Europe) Limited / ZAO Bank of Tokyo-Mitsubishi UFJ (Eurasia), The Royal Bank of Scotland plc and ZAO UniCredit Bank as Mandated Lead Arrangers and Original Lenders.

Mizuho Bank, Ltd is the facility agent while Commerzbank Aktiengesellschaft acted as the coordinating bank.

Alexei Yankevich, Deputy CEO for Economics and Finance of Gazprom neft, commented: “The second club term facility agreement in 2013 was signed in a period of favorable market conditions, securing availability of funds in 2014 on attractive terms. The substantial oversubscription achieved in the course of executing the transaction accompanied by the recent rating upgrades by Fitch and Moody’s showed investors’ perception of the high credit quality and investment attractiveness of the company. As a result, we managed to sign the company’s largest loan facility in recent years, and its flexible terms of utilization will help shape the company’s optimal borrowing policy going forward”.

REFERENCE

* Amortization of a loan is a gradual decrease in debt principal due to the borrower’s regular repayments.