Abu Dhabi National Oil Company (ADNOC) is closing in on the syndication of a $6 billion loan, sources told Reuters.
The loan will mature in two tranches. The first tranche will mature after three years and the second tranche after five years, according to Reuters’ sources. The interest rate for the three-year tranche is projected at 50 basis points more than the London Interbank Offered Rates (LIBOR) while the interest rate for the five-year tranche is expected to be 35 basis points higher than the benchmark.
The funds will be used to increase liquidity and optimize ADNOC’s capital structure, a company spokesman told Reuters.
A number of international banks are participating in syndicated-loan arrangement, according to Reuters’ sources. These banks include First Abu Dhabi Bank, HSBC, JPMorgan, and Bank of Tokyo-Mitsubishi UFJ.
In another effort to improve operations, ADNOC is considering the public listing of up to 10% of ADNOC Distribution.
ADNOC is a state-owned hydrocarbon company that belongs to the Emirate of Abu Dhabi.