BASIS POINT-Taiwan High Speed Rail seeks T$378.8bn refinancing

HONG KONG, June 19 (Reuters Basis Point) - Taiwan High Speed Rail Corp is seeking a T$378.8 billion ($12.47 billion) jumbo deal to refinance its increased T$65.5 billion facility completed last June and its debut T$323.3 billion 20-year financing sealed in February 2000, sources familiar with the matter said.

Mega International Commercial Bank is acting as a coordinator and is negotiating with the borrower on terms.

THSRC is hoping to reduce the margins on both its outstanding deals as the railway is now operating.

This means existing lenders are not in a hurry to close the deal, whereas the borrower is eager to cut interest payments on its outstanding debt. Sources close to the deal said THSRC is forking out more than 50 percent of its profits to meet current interest payments.

Tenors on the new financing could range from six to 24 years.

Last June, THSRC raised a T$24.8 billion add-on to its T$40.7 billion deal completed in July 2006, making a total of T$65.5 billion.

That facility comprises a T$19.883 billion 3.25-year term loan tranche A, a T$20.817 billion 15-year term loan tranche B, a T$9 billion three-year term loan tranche C, and a T$15.8 billion term loan tranche D.

Tranche D is further split into a T$7.9 billion five year term loan tranche D1 and a T$7.9 billion seven-year term loan tranche D2.

Tranche A pays a margin of 240 basis points over the two-year post office savings rate, tranche B pays a margin of 160 bps over the two-year post office savings rate and tranche C gives a margin of 199 bps over the close currency swap rate.