Allen & Overy has advised on TCI Sanmar Chemicals’ US$868 million project to create a polyvinyl chloride production facility at Port Said in Egypt. TCI is part of The Sanmar Group, a privately owned Indian company with a presence in chemicals, engineering, metals and shipping. The transaction marks the first substantial international project loan that is wholly financed by Indian banks.
Andrew Castle, a London-based partner in Allen & Overy’s projects, energy and infrastructure practice, said: “We are extremely proud to have been involved in this landmark transaction. It is a tribute to the tenacity and vision of Sanmar and the strength of their Indian banking relationships that they have been able to complete this financing in the face of such challenging global credit conditions.”
The syndicate of banks was advised by White & Case. It includes the State Bank of India, Bank of India, ICICI Bank, Indian Overseas Bank, Axis Bank, Export-Import Bank of India, Bank of Baroda, Indian Bank, Syndicate Bank and Union Bank of India.
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The State Bank of India, through its Bahrain branch, is also acting as a facility agent, offshore account bank and offshore security agent.
The syndicate has provided a long-term loan facility of US$565 million, while the Arab African International Bank is providing a separate US$70 million working capital facility and is acting as an onshore security agent and onshore account bank.
“We hope that the transaction’s success will encourage companies to look to Indian banks to obtain financing and will further strengthen the position of Indian banks in the global financial market,” said Ben Raynor, an associate at White & Case. “Our impression is that the Indian banks involved in the transaction are keen to exploit new opportunities both in India and internationally and our hope is that the deal will provide a springboard for Indian banks to take leading roles in future transactions.”
The Allen & Overy team was led by Castle and assisted by Joe Clinton, Camilla MacKenzie and Sergio Ung. The White & Case team was led by partner Jason Kerr and assisted by Ben Raynor, Joseph Varghese and Adam Curphey. Egyptian law advice was provided by DLA Matouk Bassiouny for TCI and Sharkawy & Sarhan for the funders.
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