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Fertiglobe secures $1.1B for new capital structure

Fertiglobe secures $1.1B for new capital structure

ArabFinance: Fertiglobe, the strategic partnership between OCI and ADNOC, succeeded in securing $1.1 billion to implement a new capital structure, CNBC Arabia reported.  

The fund will be used to refinance $250 million of existing debt, pay an $850 million dividend to its two shareholders OCI and ADNOC, and additionally put in place a new $300 million Revolving Credit Facility (RCF).

Headquartered in Abu Dhabi, Fertiglobe’s new robust capital structure creates flexibility for Fertiglobe to pursue growth opportunities in addition to paying sustained and attractive dividends through the cycle while maintaining an investment-grade profile.

The new bridge facility carries an interest rate starting at LIBOR + 1.05%, with a 0.25% increase per quarter from year 2, and has a tenor of 30 months. In addition, a new 5-year $300 million RCF will be put in place, which carries an interest rate of LIBOR + 1.75%, providing ample liquidity.

Additionally, the new capital structure helps OCI to optimize its balance sheet further, gives the flexibility to lower cash interest and supports future growth opportunities in clean ammonia and other decarbonization initiatives for OCI as a whole and Fertiglobe.

Fertiglobe is targeting to pay an amount of at least $315 million in dividends for the financial year 2022 (50% paid in October 2022 and 50% paid in April 2023), subject to general meeting approval.

The company is also targeting a dividend distribution for the period covering H2 2021 of at least $150 million, which will be paid in April 2022. Dividend payments will be subject to Board discretion, market conditions and general meeting approval.

 

 

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