Oman Shipping Company, wholly owned by the Sultanate of Oman, successfully raised $227 million to finance its purchase of 10 new Medium Range Tankers, which are chartered to Shell Tankers Singapore for seven years.
Societe Generale acted as Sole Arranger and Sole Underwriter for the landmark transaction, which involved a combination of export credit agency (ECA) and commercial financing. Seven of the ten vessels were covered by Korea’s export credit agency, K-SURE.
“We are very pleased with the successful close of this landmark transaction particularly in the current environment, a testimony to our current strategy and its robustness. Beyond the importance for OSC, this deal perfectly meets our Company’s objectives in terms of diversification of funding sources,” said Tarik Al-Junaidi, Chief Executive Officer, Oman Shipping Company.
The funding covered the purchase of ten 50,000 dwt medium-range tankers, built by Hyundai Heavy Industries of South Korea. Societe Generale underwrote the whole transaction on the basis of an innovative structure: for seven of the vessels, a 12-year ECA facility combined with a Tied Commercial Loan. The remaining three vessels were financed under a seven-year mortgage loan. Societe Generale, Crédit Agricole Corporate & Investment Bank, the Korea Development Bank and ABN Amro acted as Mandated Lead Arrangers.
“At the start we set a number of objectives that had to be fulfilled, including finding one single bank able to assist us in raising financing for the acquisition of 10 vessels, raising long-term financing to move towards the asset lifespan, obtaining competitive pricing, diversifying our banking pool and increasing the OSC Group’s visibility within the international banking market. Societe Generale’s commitment to meet all our requirements through an innovative model raised the profile of OSC and attracted liquidity to successfully close this transaction,” said Venugopal Venkatesh, Chief Financial Officer of Oman Shipping Company.
“We are delighted to be involved in this landmark financing which comes at a time when various Omani sovereign entities are in the market to raise long term funding. By using ECA financing for the majority of this project, Oman Shipping Company is leveraging the capacity of international banks to join future deals. The Sultanate of Oman, like most GCC nations, has significant requirements when it comes to financing assets and infrastructure. As such, Oman Shipping Company is likely to serve as a reference for others in the Middle Eastern market,” said Richad Soundardjee, Chief Executive Officer Middle East at Societe Generale.
Societe Generale in the Middle East
Societe Generale has been active in the Middle East since 1997. The Group’s approach favours long-term value creation, helping the region achieve its sustainable economic and social goals by deploying resources and providing a broad range of solutions and services. Serving clients from its hub in Dubai, complemented by an on-the-ground presence in Abu Dhabi and Riyadh, it has the capacity, as a multi-specialist international corporate and investment bank, to align its global business lines with regional expertise to be a partner of choice.
Societe Generale serves its clients across a wide spectrum of categories:
- Corporates, Financial Institutions and Sovereign Entities: providing a global advisory approach (M&A, project finance advisory, capital structuring, and asset & liability management), as well as quality capital raising solutions across the debt and equity spectrum, optimised financing and expert risk management responses notably in the realm of foreign exchange and rates derivatives.
- Institutional Investors: offering reliable and sound investment opportunities and risk management solutions through its integrated global markets platform delivering seamless access to markets (equity, rates, credit, currencies, commodities and derivatives), as well as advice and solid financial engineering, quality of execution – both Agency and principal-, forward-looking research across asset classes, an industry-leading clearing proposition and prime brokerage services.
For more information, visit our website www.mea.societegenerale.com
© Press Release 2017
