Kazakh state oil and gas company KazMunaiGas has asked international banks to submit proposals for a $1 billion five-year unsecured loan, banking sources said on Friday, Reuters reported.
The loan, which will provide new money and refinance existing debt, is the first international syndicated loan to emerge from Kazakhstan since late 2009 following the restructuring of the country's banking sector in 2010.
"This loan re-opens the Kazakh market," a banker close to the deal said.
Kazakh mining group ENRC may follow KazMunaiGas to the loan market and is quietly sounding banks out on a new $500 million, one-year deal, the bankers said. KazMunaiGas and ENRC could not immediately be reached for comment.
PROPOSALS DUE
Banks are expected to submit proposals on the $1 billion deal next week, which is double the size of the $500 million financing that KazMunaiGas said that it was planning to raise in January.
"We raise loans mainly for the restructuring of existing debt ... secondly for financing our share in projects and thirdly for financing new projects," CEO Kairgeldy Kabyldin told Reuters in January. KazMunaiGas is facing a higher interest margin on its new loan than its last loan - a $3.1 billion loan unsecured bridge loan that backed the acquisition of a 75 percent stake in Rompetro in January 2008.
That loan paid an all-in spread of 90 basis points over LIBOR.
This time KazMunaiGas could be looking at a similar interest margin to the swapped rates on its 2015 and 2018 eurobonds, which were trading at 237-260 basis points on Friday.
The new loan will be made through a special-purpose vehicle with the guarantee of KazMunaiGas, bankers said.