**Landmark SAR7.5 bl restructuring**
HSBC acted as Sole Financial Advisor to Al-Ittefaq Steel Products Company ("ISPC"), the leading private Saudi steel manufacturer, on its restructuring of approximately SAR 7.5bn in debt facilities and liabilities, comprising debt obligations to 18 local and regional banks. The transaction represents one of the first and largest corporate debt restructurings in Saudi Arabia.
The restructuring plan agreed with creditors is based on a long-term recovery plan for ISPC. This involves the funding and transfer of assets to fully integrate the production capability of ISPC to grow future potential cashflows and resulting in quicker paydown of liabilities. The debt has been restructured over a 6 year period at competitive financing rates and allows ISPC to undertake significant capital expenditure to complete the Arabsteel project to a 1million tonne per annum capacity taking ISPC's liquid steel capacity to 2 million tonnes per annum.
ISPC is one of the largest integrated private sector steel manufacturers in the MENA region. Over the last 20 years ISPC has developed a combined production capacity of direct reduced iron, billets, steel reinforcement bars, angles, cuts and bends, wire mesh, coil and other products reaching over 3 million metric tonnes per annum of rolling capacity.
Dr Hilal Hussain Al Tuwairqi, Chairman of ISPC and also the current Chairman of the Arab Iron & Steel Union said "I am extremely pleased that ISPC has managed, with the continued support and efforts of our lending banks, to reach this successful restructuring. Without the support of the banks, our customers and the tireless effort of our employees this would not have been possible.
I believe the restructuring plan and in particular the completion of Arabsteel will allow ISPC to become a stronger company and ensure continued success. ISPC is the largest private sector steel business in the region, employing more than 2,800 Saudi nationals. We are committed to serving the economy, increasing steel capacity and creating more jobs for Saudis. I am positive about the economic outlook of Saudi Arabia and the government's plans to spend on infrastructure are likely to sustain demand for steel products."
Walid Khoury, CEO of HSBC Saudi Arabia said "We are pleased to have advised ISPC on this complex and landmark transaction. This deal demonstrates HSBC's insight into our client's business and ability to support our important clients throughout their business cycle. We would like to congratulate ISPC, its shareholders, management and employees on the close of this successful transaction."
Key awards for HSBC's Global Banking and Markets business in the MENA region:
Euromoney Awards for Excellence 2011
Best Investment Bank in Saudi Arabia
Best Debt House in the Middle East
Best Risk Advisor in the Middle East
Best at Cash Management in the Middle East
Euromoney FX Poll 2011
Best for Middle Eastern currencies
Best for African currencies
Best for emerging markets options
Best for emerging market currencies trading - spot/forward
EuroWeek Bond Market Awards 2011 - Best Middle East house
IFR Awards 2010
House Awards
Emerging Markets Bond House of the Year
The Banker Deals of the Year 2011
Middle East
Bonds SSA: Government of Dubai
Loans: Qatar Aviation Lease Company
Equities: IPO of Wataniya Palestine Mobile Telecoms
Euromoney Islamic Finance Awards 2011
Best Sukuk House
Best International Islamic Bank
Best Deal of the Year and Best Sukuk Deal - Government of Malaysia USD1.25 billion sukuk
Best Project Finance Deal - Ma'aden Aluminum
Credit Awards 2010
Best Bank for Islamic Finance
Euromoney Awards for Excellence 2010
Best Global Emerging Markets Bank
Best Global Emerging Markets Debt House
Best Global Sovereign Advisory House
Best Investment Bank in the Middle East
Best Investment Bank in Saudi Arabia
EuroWeek Bond Market Awards 2010
Most Impressive Bank advising Middle Eastern clients
-Ends-
HSBC Bank Middle East Limited (HSBC)
HSBC is the largest and most widely represented international bank in the Middle East. HSBC Bank Middle East Limited has 53 branches throughout the United Arab Emirates, Oman, Bahrain, Qatar, Kuwait, Jordan, Lebanon, Pakistan, Algeria and the Palestinian Autonomous Area. In addition to the branch network HSBC maintains a representative office in Tripoli, Libya. This extensive regional coverage is strengthened by HSBC Bank Egypt SAE; HSBC Saudi Arabia Limited; SABB Securities Limited; SABB Takaful Co.; and Dar Es Saalam Investment Bank.
Charles Clarke
Senior Manager, Corporate Communications
Global Banking and Markets and HSBC Amanah
HSBC Bank Middle East Limited
Tel: 971 4423 5640
Email: charleswclarke@hsbc.com
© Press Release 2011
