(The following item was previously published by Basis Point, a Thomson Reuters publication)
By Maggie Chen
HONG KONG, March 14 (Reuters Basis Point) - San Miguel Corp is seeking a loan of up to $800 million in ringgit to back its purchase of ExxonMobil’s Malaysia assets, banking sources told Thomson Reuters Basis Point, banking sources said on Thursday.
Maybank, Standard Chartered Bank and UOB have been mandated to arrange the financing for the Philippines-based conglomerate, banking sources said.
San Miguel announced that it had agreed to buy three subsidiaries comprising ExxonMobil’s downstream oil business in Malaysia last August in a deal valued at $610 million, San Miguel said.
San Miguel is finalising the acquisition through majority-owned Petron Corp, it said in a March 1 stock exchange filing. Petron Corp is the largest oil refiner in the Philippines.
San Miguel’s relationship banks have been sounded out about joining the loan, which may be structured on a non-recourse basis.
The terms of the loan are still being finalised, but it is expected to have a mix of maturities including a five-year tenor and a shorter-dated tranche for working capital.
The companies being bought are Esso Malaysia Bhd (EMB), a publicly traded company in which Exxon Mobil owns a 65 percent stake, and wholly-owned subsidiaries ExxonMobil Malaysia Sdn Bhd (EMMSB) and Exxon Mobil Borneo Sdn Bhd (EMBSB).
An acquisition of ExxonMobil’s stake in Esso Malaysia would trigger a general takeover offer to acquire the remaining 35 percent of the company.
San Miguel said last August that it it may spend as much as $1.2 billion upgrading the existing Port Dickson refinery operations of Esso Malaysia.
EMB, EMMSB and EMBSB form an integrated business engaged in refining, distributing and marketing petroleum products. Their assets include the Port Dickson refinery with a rated capacity of 88,000 barrels per day, seven fuel distribution terminals and a network of about 560 branded service stations, 420 of which are company-owned.
Maybank is the advisor on the deal.
Petron Corp raised a $480 million, five-year loan from nine banks last September. Bank of Tokyo-Mitsubishi UFJ, Mizuho Corporate Bank, HSBC, Maybank, StanChart, DBS Bank, Sumitomo Mitsui Banking Corp, Chinatrust Commercial Bank and UOB participated in that loan, which paid a margin of 235 basis points over Libor. (Reporting by Maggie Chen)