Golar LNG, controlled by Norwegian shipping magnate John Fredriksen, has secured a $1.125 billion financing agreement for the first eight of 13 newbuild LNG carriers and Floating Storage and Regasification Units it has ordered from South Korean shipyards.
The financing is divided into three tranches. The first is a term loan of $450 million funded by a consortium of lenders and guaranteed by a 95 percent Korea Trade Insurance Corp. policy.
Secondly, there is a term loan of $450 million funded by the Export Import Bank of Korea, and thirdly, another term loan of $225M funded by a syndicate of commercial banks.
The tranches have a 12-year repayment profile, Golar said.
Golar also explained that in anticipation of entering into the financing deals, the company had previously entered into interest rate swaps to hedge the majority of the loan such that the all-in interest cost for the initial seven years of the facilities will be around 3.74 percent.
Commenting on the agreement, Golar's Chairman Fredriksen said; "Golar has demonstrated its commitment to LNG Shipping and FSRUs with its newbuilding programme, on the back of extremely attractive long-term market fundamentals.
"To have the support of the Korean ECAs to this extent, without requirement for contracts in place, enables Golar to take a more flexible and long-term approach to the LNG shipping market," Fredriksen added.
"To see so many of our relationship banks together with the Korea Finance Corp. and a number of new banks participating in this oversubscribed facility is both reassuring and welcome.
"Collectively they provide a strong footing for the company's ambitious growth plans and we look forward to their on-going involvement in our business," Fredriksen stated.
Citibank N.A, London Branch acted as global coordinator, book runner and documentation agent to the transaction, Golar said.
The mandated lead arrangers were Citibank, Danske Bank A/S, DvB Bank SE, The Export Import Bank of Korea, Nordea Bank Norge ASA, Korea Finance Corporation, Skandinaviska Enskilda Banken and SwedBank AB.
