A subsidiary of port operator International Container Terminal Services Inc. in Australia secured a $300-million loan from seven global financial institutions to construct and develop a container port in Melbourne.
ICTSI, led by businessman Enrique Razon Jr., said Victoria International Container Terminal signed a syndicated loan facility worth $300 million with Citibank N.A., KFW IPEX-Bank and Standard Chartered Bank as mandated lead arrangers and book runners.
Bank of China Ltd., DBS Bank Ltd. and Investec Bank PLC are also mandated arrangers and Cathay United Bank is a lead arranger.
The port operator said the loan facility would provide significant financial flexibility with long-dated tenors of 7, 10 and 16 years. Finvera, the Finland-based export credit agency also participated in the transaction by providing a guarantee for a portion of the facility.
“The newly-secured financing will support the ongoing construction and development of VICT at Webb Dock East in the Port of Melbourne, Australia,” ICTSI said.
Construction of the terminal started in late 2014 and will be completed in two phases. Phase one will be ready for commercial operations in the fourth quarter this year while phase two will be available in 2017.
“VICT is extremely pleased to have signed this project finance facility with internationally renowned banks as this is a testament to the viability of VICT. We remain committed to working with all our partners – the Port of Melbourne, local community, our contractors, and now our lenders – to deliver to Melbourne a world-class and industry leading container terminal,” VICT chief executive Anders Dommestrup said.
ICTSI corporate finance director Manuel Pascua said the VICT deal pushed the project finance envelope in Australia on a number of aspects, and this has made the process quite challenging.
“Thanks to the collaborative effort put in together with our lending partners, we achieved a final debt structure that positions VICT for both short and long term financial strength,” Pascua said.
ICTSI earlier secured a major project finance facility in October 2015 when Contecon Manzanillo S.A. de C.V. signed a $260-million loan for its port development and operations in the Port of Manzanillo, Mexico.
The port operator earlier reported a net income of $42.2 million in the first quarter, down 22 percent from $54 million last year.
ICTSI’s revenue from port operations amounted to $266.5 million in the first quarter, a decrease of 10 percent from $296.1 million in the same period last year.