Arcelormittal South Africa (AMSA) and its subsidiary, Saldanha Steel, have been granted a $346 m revolving borrowing base facility with a 36-month tenor to finance working capital and for general corporate purposes. The transaction will allow AMSA, South Africa’s largest steel producer, to finance its working capital as part of its balance sheet restructuring.
The syndicated facility was arranged by Deutsche Bank and Absa Bank (Barclays Africa Group) and was over-subscribed, being upsized from $269 m million. The Facility is supported by cross-guarantees from AMSA and Saldanha and limited asset security.
“We’re delighted to have supported Arcelormittal South Africa on this strategic transaction. The raising of a borrowing base facility of this size is a real achievement in the current market. It also reflects an ever-increasing trend towards using structured trade finance techniques in managing working capital,” notes Frances Okosi, Banking & Finance Partner at Baker McKenzie in Johannesburg.
Okosi was lead partner for Baker McKenzie on this transaction, and was assisted by Senior Associate Megan Hardy and Candidate Attorney, Duduzile Zulu.