SINGAPORE (Reuters) - Joint coordinating banks ING and Royal Bank of Scotland launched on Tuesday the much delayed $1.56 billion debt package for Jurong Aromatics Corp's (JAC) Singapore plant, the company and its bankers said.
Some $1.24 billion, or 80 percent of the debt, will be financed or guaranteed by two South Korean export agencies for a tenor of up to 15.5 years.
Export-Import Bank of Korea will provide a direct loan of $340 million and a 100 percent guarantee for a further $280 million.
Another $620 million tranche will be fully guaranteed by Korea Trade Insurance Corp.
The balance of the debt comprises a $155 million 10-year uncovered commercial bank loan, a $50 million uncovered facility with a tenor of up to 15.5 years, and a $115 million five-year working capital facility.
"We expect a very favourable reception from lenders given the long anticipation by the bank market of its launch, the favourable recovery of the financial markets and robust economics of the project," said a JAC spokesman.
The $2.4 billion Jurong Aromatics project involves the development of a condensate splitter and aromatics facility on offshore Jurong Island and will produce 1.5 million metric tons of aromatics per year and 2.5 million metric tons of transport fuels per year, the company said.
The plant will come on stream in 2014 with construction starting early in 2011, it added.
The deal is set to be the biggest U.S. dollar funding in Singapore this year, bankers involved in the deal said.
"The timing seems perfect now with almost no other deals of this size or quality expected in the market this year," said Bruce Macfarlane, who heads the team at ING acting as JAC's financial advisers.
The major sponsors of the project are the SK Group of Korea, who holds a 30 percent stake, the Jiangsu Sanfangxiang Group of China, with 25 percent and Swiss oil trader Glencore
Oil major BP
Banks are required to respond to the invitations with firm commitments in October and the deal is expected to close in late November or early December of this year, ING said.
There are four levels of participation ranging from $75 million to $150 million, with banks at the highest tier receiving the title of mandated lead arranger and bookrunner.
(Reporting by Francis Kan; Editing by Ramthan Hussain)
