Reliance Industries on Tuesday said it has raised a term loan of USD 573 million to part finance construction of a six very large ships for transportation of ethane from the US.
The firm has ordered six very large ethane carriers (VLECs), the largest ethane vessels ever built in the world.
“The facilities (loan) with door to door tenor of 12 year comprise of a Korea Trade Insurance Corp (K-sure) insured tranche of USD 286.5 million and a commercial tranche of USD 286.5 million,” RIL said in a statement. “The facilities shall be secured by collateral of respective VLECs.” VLECs would transport ethane from US to Dahej in Gujarat.
The gas will be used for feeding RIL’s crackers at Dahej, Hazira and Nagothane “to ensure consistent supply of ethane at competitive prices.” The VLECs are financed in a debt-to-equity ratio of 80:20.
“Despite global slowdown in the shipping industry, both tranches of the facilities (loan) were oversubscribed by two times and saw participation from seven banks in K-sure covered tranche and six banks in the commercial tranche. This reflects the strong credit standing of RIL in the international financial markets,” it said.
Banks lending to RIL include The Hongkong and Shanghai Banking Corp Ltd, Standard Chartered Bank, Banc of America Leasing & Capital LLC, Australia and New Zealand Banking Group Ltd, Citibank, DBS Bank Ltd, BNP Paribas, Societe Generale, Sumitomo Mitsui Banking Corp, The Bank of Tokyo-Mitsubishi UFJ Ltd, Credit Agricole Corporate and Investment Bank and JP Morgan Chase Bank NA.
Reliance Industries has made an open offer for the takeover of Network18, which owns Chillicious.com and other digital, print and TV channels