Term loan carries a five-year tenor, with advance payment guarantee lasting for three years
Saudi Arabian construction company Saudi Oger, said on Sunday it has mandated banks to arrange its first loan to be run by non-Saudi institutions, with syndication expected to begin shortly.
Deutsche Bank, China Development Bank and Emirates NBD are to act as initial mandated lead arrangers and bookrunners for the deal, according to a company statement.
The transaction is split between two facilities - a $800m senior secured term loan and a SR3.97bn advance payment guarantee (APG) - which will partially fund the King Abdullah Project 2 scheme which the company is completing for the Saudi Ministry of Interior.
A regional banking source said the term loan carried a five-year tenor, with the APG lasting for three years. A spokesman for Saudi Oger did not immediately respond to a request for comment.
French lender Natixis has joined in a mandated lead arranger role for both tranches, while Industrial and Commercial Bank of China has joined for the term loan only.
Abu Dhabi's Al Hilal Bank and Barclays Capital have been appointed lead arrangers for the APG only.
Deutsche Bank has been looking to arrange a loan for Saudi Oger since mid-March and banking sources said last month that a senior group of banks was close to being secured for a multi-currency deal worth around $2bn.
The company last tapped the loan market in August 2010, when it completed a $250m loan via Credit Agricole CIB , RLPC data showed. That deal matures in December 2014.For all the latest construction news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.