Deutsche Bank – in collaboration with global steel trader Duferco – has arranged a US$1.5bn two-year syndicated structured steel pre-payment term loan facility for Tangshan Iron & Steel Group.
Tangsteel is a key subsidiary of one of China’s largest state-owned steel producers. The deal sets a new industry record as the largest structured commodity trade finance facility for a Chinese company, surpassing the previous record of US$800m, which was also lead arranged by Deutsche Bank for Tangsteel in 2013.
Deutsche Bank acted as coordinating mandated lead arranger and bookrunner for a fourth consecutive structured pre-payment finance facility for Tangsteel – the first closed in May 2012 for US$$200m, the second in February 2013 for US$300m and the third in October 2013 for US$800m. The bank’s Hong Kong branch acted as the facility agent and account bank, and DB Trustees (Hong Kong) Limited as the security agent for all four facilities.
“The oversubscribed facility has been well received by the market with participation from 22 banks globally,” the bank reported. “The funding will be used to facilitate and support Tangsteel’s exports of steel products to Duferco Asia Pte and Duferco SA via Tangsteel’s offshore trading platform, Sinobiz Holdings. “
Frank Wu, Asia Pacific head of structured commodity trade finance, global transaction banking at Deutsche Bank, added: “This structured pre-payment finance facility is our fourth consecutive loan for Tangsteel and the largest facility of this kind ever arranged for a Chinese company. The success of this landmark transaction underscores Deutsche Bank’s strong partnership with Duferco and Tangsteel and clearly demonstrates the bank’s strength in arranging structured commodity trade finance facilities in the Asian market.”
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