A group of African banks has signed a US$194mn senior debt facility to rehabilitate the Beitbridge border post, a crossing that connects Zimbabwe and South Africa. Rand Merchant Bank (RMB) acted as co-ordinating bank and sponsors’ advisor and, along with Absa, Nedbank and Standard Bank, was a mandated lead arranger (MLA). The African Export-Import Bank (Afreximbank) and the Emerging Africa infrastructure Fund (EAIF) were senior lenders, with the latter also acting as a mezzanine lender. The senior debt facility makes up the majority of the US$297mn project cost; the outstanding balance was obtained via a mezzanine debt of US$21mn and through equity. The Export Credit Insurance Corporation (ECIC), the South African export credit agency (ECA), acted as a commercial and political risk insurer for the senior debt facility and, alongside Afreximbank, was a political risk provider for a portion of the shareholders’ equity and loan investments. By structuring ECA-backed tranches, the banks were able to deliver competitive financing terms through longer tenors and lower interest rates, according to a statement from RMB. The tenor of the senior debt facility is 11 years, while the tenor for the mezzanine debt is one year longer. The proceeds will be used by Zimborders,… continue reading
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Source: CTRM Center