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Sun 2 Dec 2007 04:00 AM

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BankMuscat in US$166m Octal loan

BankMuscat has agreed a US$166.5 million loan facility for Oman-based Octal Petrochemicals as it prepares to launch a new plastic packaging venture in Salalah Free Zone.

BankMuscat has agreed a US$166.5 million loan facility for Oman-based Octal Petrochemicals as it prepares to launch a new plastic packaging venture in Salalah Free Zone.

The facility is made up of a $148.5m term loan, of which $34.5m has been syndicated to Bank Dhofar, and $18m in working capital.

Financing was raised in three stages over the last year and completes Octal's initial $300m investment in proprietary technology and custom-made production lines.

Sheikh Saad Suhail Bahwan, chairman of Octal, said: "This is a world-class, US$1 billion company taking shape in Oman and we're delighted to have the support of BankMuscat as our financial advisor.

"Our initial US$300 million investment has been arranged on a 50:50 debt equity basis, which allows us to expand at speed.

"The equity placement was significantly oversubscribed which shows the enthusiasm of the local market."

Octal's Oman-based investors include NIFCO (National Investment Fund Company), Muscat Overseas, Oman Investment Company, Malatan Trading and Contracting, Oman and Emirates Investment Holding, Suhail Bahwan Group, DIDIC, as well as BankMuscat. Individual and institutional investors in Saudi Arabia, Kuwait and the US are also committed to the project.