ADES International Holding Company will borrow a syndicated loan worth $450 million over five years in order to finance acquisitions following the company’s 2017 initial public offering (IPO), the National reported.

The European Bank for Reconstruction and Development (EBRD) announced the provision of $125 million debt fund as part of the $450-million-facility in order to enable ADES to expand its onshore and offshore drilling fleet in Egypt, the Middle East and North Africa.

ADES will receive the money in three tranches, with borrowing costs fixed at 5% over the LIBOR rate. The loan will be granted from 11 banks in a facility that is being jointly-arranged by EBRD and Bank of America Merrill Lynch, while Egypt’s EFG-Hermes investment bank acted as the financial adviser.

The credit facility includes a working capital tranche; a tranche aimed at repaying the company’s existing debt; and a capital expenditure (CAPEX) tranche to fund ADES’ capital expenditures for acquiring new entities and new rigs, as well as post-IPO expansion.

“As previously communicated in our recent 2017 results announcement, this facility, together with the proceeds of ADES’ May 2017 initial public offering on the London Stock Exchange, will allow us to consolidate our borrowings and enhance ADES’ purchasing power,” said Mohamed Farouk, chief executive of ADES International.