General syndication for LG Chem's $120 million loan style-FRN has closed following good demand. The deal was over-subscribed and mandated arrangers had to scale back allocations. ABN AMRO, Hanvit Bank and Kookmin Bank were the mandated arrangers for the deal, while Bayerische Landesbank Girozentrale joined as co-arranger.
The FRN issue is divided into three equal tranches of $40 million each with differing maturities. Tranche A, with a maturity of 2.5 years, pays a flat management fee of 40bp to lead managers, 35bp to co-leads and 32.5bp to senior managers. Tranche B, with a maturity of three years, offers a flat management fee of 54bp to leads, 48bp to co-leads and 45bp to senior managers. Tranche C will have a maturity of 3.5 years and pays 70bp to leads, 63bp to co-leads and 59.5bp to senior managers.
All-in (over Libor) for the banks on the three levels will be 76bp, 74bp and 73bp for Tranche A, 78bp, 76bp and 75bp for Tranche B and 80bp, 78bp and 77bp for Tranche C respectively. The banks were required to participate in all the three tranches on a pro-rata basis. The fees are applicable on the basis of commitments of $10 million or above for lead managers, $5-$9 million for co-leads and $2-$4 for senior managers.
Final allocations are as under:
|
|
Final Allocation US$ |
Tranche A (2.5 years) US$ |
Tranche B (3 years) US$ |
Tranche C (3.5 years) US$ |
|
Coordinating Arrangers |
|
|
|
|
|
ABN AMRO Bank N.V. |
8,400,000 |
|
1,000,000 |
7,400,000 |
|
Kookmin Bank |
8,300,000 |
500,000 |
|
7,800,000 |
|
Woori Bank |
8,300,000 |
|
|
8,300,000 |
|
Co-Arrangers |
|
|
|
|
|
Bayerische Landesbank Girozentrale, Singapore Branch |
20,000,000 |
10,000,000 |
10,000,000 |
|
|
China Construction Bank, Hong Kong Branch |
15,000,000 |
5,000,000 |
5,000,000 |
5,000,000 |
|
Industrial and Commercial Bank of China, Seoul Branch |
20,000,000 |
10,000,000 |
10,000,000 |
|
|
Mizuho Corporate Asia (HK) Limited |
15,000,000 |
5,000,000 |
5,000,000 |
5,000,000 |
|
Lead Manager |
|
|
|
|
|
Bayerische Hypo-und Vereinsbank AG, Hong Kong Branch |
12,000,000 |
4,000,000 |
4,000,000 |
4,000,000 |
|
Co-Lead Managers |
|
|
|
|
|
Bank of Communications, Singapore Branch |
5,000,000 |
2,000,000 |
1,500,000 |
1,500,000 |
|
Korea First Finance Limited |
5,000,000 |
2,500,000 |
2,500,000 |
|
|
Senior Manager |
|
|
|
|
|
Comerica Bank |
3,000,000 |
1,000,000 |
1,000,000 |
1,000,000 |
|
Total |
120,000,000 |
40,000,000 |
40,000,000 |
40,000,000 |
LG Chem, the largest chemical company in South Korea, was de-merged from LG Chemical Ltd. in April last year. LG Chemical was broken up into three parts - LG Chem, LGCI and LG Household and Health Care.
LG Chem reported net profits of KRW92.3 billion for the first quarter of 2002 of sales of KRW1.264 trillion. The company manufactures a wide range of products from petrochemical goods to high-value added plastics, floorings and automotive parts. It also manufactures lithium-ion and lithium-polymer batteries that are used in mobile phones, laptop computers and personal digital assistants (PDA). The company plans to become the third largest producer of lithium batteries by 2005.
