Eastern Multimedia Co (EMC), a cable TV and broadband service provider, signed its NT$13.8 billion ($414 million) multi tranche loan yesterday in Taipei. The deal was arranged by ABN Amro Bank, ANZ Investment Bank, Chinatrust Commercial Bank, First Commercial Bank, SG Asia and WestLB.
The transaction was completed in early January with an oversubscription of some 58%. Signing was originally scheduled for the end of January but was delayed due to the lunar new year holiday.
A total of 17 banks joined in general with the arrangers achieving a sell down of approximately 55% in the syndicated $187 million and NT$5.9 billion ($177 million) tranches. The remaining $50 million was provided on a bilateral basis by First Commercial Bank.
Banks were offered a margin of 300bp and a top tier front end fee of 120bp for the amortising seven year facility. Investors were eager to book the asset with both the borrowers strong cash flow and the detailed structure proving very attractive.
The Taiwanese loan market is mainly composed of tightly priced corporate loans. This deal, along with the highly successful broadband transaction completed last year, shows that there is appetite for these credits and this may pave the way for more structured financings in the future.
Charles Wu, CEO and President of EMC was delighted with the result saying that "the facilities enable EMC to reduce our borrowing costs while pursuing our growth strategy. The borrower has under gone heavy investment in digitalising its systems and networks in recent times and hopes to benefit from its premium services in the future.
Proceeds from this loan will refinance the existing debt of the company and its 13 majority owned system operators.