US$1 billion bridging loan for Petronas Chemicals

19 Mar 2018 / 22:45 H.

    PETALING JAYA: Petronas Chemicals Group Bhd has executed a bridging loan agreement of US$1 billion (RM3.9 billion) with external lenders comprising local and international banks, being one of the conditions for the divestment of its 50% stake in PRPC Polymers Sdn Bhd to Saudi Arabian Oil Co (Saudi Aramco).

    In a filing with Bursa Malaysia today, Petronas Chemicals said the bridging loan will be used to finance part of the costs to develop, construct, commission and operate polymers and glycol plants. The plants are under construction in Pengerang, Johor, and are expected to be completed in 2019.
    The bridging loan has a tenure of 12 months with an extension of six months at the discretion of PRPC Polymers. It is expected to be repaid once long-term project financing is secured at a later date.
    The lenders have requested that Petronas and Saudi Aramco provide corporate guarantees on a several, not joint, basis as security.
    In view of the corporate guarantee provided by Petronas to the bridge loan lenders, Petronas Chemicals has entered into a back-to-back guarantee arrangement through a binding letter of undertaking issued by Petronas.
    On Bursa Malaysia today, Petronas Chemicals closed unchanged at RM8.15 on volume of 5.7 million shares.

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