JB's weekly round-up - 16 December 2013

Welcome to the weekly round-up of the TXF news service
 

Be in my video 
Over the past couple of months, TXF has been beavering away along with our friends at Silversun Media to create a library of free, high quality video content for our website.

All those videos are now live. So you can view a number of excellent speeches from our ECA Finance Conference in Paris in November, Geoff Wynne's inaugural breakfast briefing as partner at Sullivan & Worcester, as well as a whole host of engaging interviews with the likes of Citi's John Ahearn, Thomas Baum of Euler Hermes, Berne Union president Dan Riordan and many more. Here is the link: www.txfnews.com/videos. You can also view ourTXF YouTube channel
 
Feeding frenzy
I know it has been quiet overall for many in the commodity finance world, but the Gunvor $1.5 billion revolver banged into the market to help some out. Over 40 banks took part in the transaction as the deal came in at a timely juncture for many. There were nine book-running mandated lead arrangers on the deal. See the full list of banks involved – TXF News 9 December.
 
Also closing around the same time was the Russian Copper Company $250 million pre-export finance (PXF) deal (TXF News 9 December). The deal had initially launched in early October, and was driven by Natixis, SG CIB and Rosbank. It was interesting to see Federated Project and Trade Finance Core Fund come into the deal as an arranger.
 
Absent friends
Of course, there have been many absent friends and traditional customers from the PXF market, particularly when it comes to the Russian/CIS market. Some of these candidates have switched to loans from local banks, or have looked to diversify their funding options.One such company to raise its head last week was Russian oil company Lukoil – absent from the PXF market for several years now. But in this instance Lukoil came to the market with an ECA-backed export finance requirement (TXF News 13 December).
 
The deal is a $570 million export credit financing to upgrade Lukoil’s Bulgarian refining subsidiary. The Sace-backed facility was arranged by BNP Paribas, ING, SG CIB and UniCredit, with the latter two being the global coordinators. The deal will prove immensely important for the Bulgarian economy.
 
On the project front, Sumitomo Corp and GDF consortium signed  a $1.43 billion loan for the first phase of Kuwait’s Az-Zour North power and desalination plant(TXF News 13 December). BTMU, SMBC, Standard Chartered and National Bank of Kuwait, backed by JBIC and Nexi, have arranged the debt financing. Further details are expected though as there is now also involvement from South Korea’s Hyundai Heavy Industries.
 
You can’t always get what you want
Last week we revealed the expected pricing for the $1 billion Trade MAPS 1 securitisation, suggesting it was going to end up somewhere in the region of one month Libor plus H60 bp (TXF News 11 December). We weren’t far off – the AAA-rated top tranche priced at 1mL +70 in the end. There was always going to be a good degree of variables affecting the eventual price, but it is likely that both institutions may have expected a more favourable pricing. This was a first off for Citi and Santander, and for the second offering next year more positive results will be expected, especially now a larger pool of institutional investors will be familiar with the asset class. Other banks are known to be talking with Citi about collaboration.
 
We will be exploring the deal and its wider impact to the industry in more detail over the coming weeks.
 
Experience is everything
On the people front, last week international law firm Ince & Co appointed Stuart Shepherd as its new global head of trade (TXF News 9 December). Stuart has over 30 years of experience as a commodities and shipping specialist and will undoubtedly lead the team with true style.
 
Elsewhere, we learn that Bonnie Galat, the IFC’s chief representative for trade and supply chain in Europe and based in Paris, is leaving (TXF News 11 December). She moves to Washington DC this month and retires from the IFC at the end of January 2014. Bonnie has been a stellar operative for the IFC for many years, and an absolute delight to work with. We wish her well.
 
What song?
Apologies I haven’t deliberately – or have I? - slotted any songs in this week. Last week’s answer was Song to the Siren by This Mortal Coil. Tough? Perhaps. Congratulations to last week’s winner - José Luis Vicent, executive director, global export & agency finance at Santander in Madrid – who has a phenomenal knowledge of music. An un-circulated 2008 AA series Zimbabwean Z$100 trillion banknote is on its way to José.
 
And talking of banknotes, I happened to be in the office of a commodity banker last week who produced a Z$100 billion banknote – which is aptly known as an Agro Cheque, and this is actually printed on the note. It turned out that I had presented said banker with the note at a conference a year or so back for his representation on a panel. I will see if I can dig out some more (no pun intended!).
 
And finally………
Over the past week or so we have had a rip-snorting response to our formal launch of tagmydeals, with several new banks working with us to submit transactions. And while on the subject of deals, TXF is now open to receive submissions for our Deals of the Year – ‘The Perfect 10’ – so please send in your most innovative deals explaining to us why you think your deal deserves to win. Submissions are due by 20 January 2014. A separate email reminder is also going out.
 
Keep the faith. (PS. As a Sunderland football fan, I have to!)
 
Jonathan Bell
Editor in Chief