Lion Nathan Limited (LNN) has entered into a syndicated loan facility arranged by Mizuho Corporate Bank, allowing the company to access 30 billion Japanese Yen ($340 million). The company said the loan had been secured at a very competitive rate and with covenants consistent with LNN's current facilities.
The company said the term of the debt would be for five years from drawdown and, when swapped into Australian dollars, was priced at bank bill swap rate plus 75 basis points excluding arrangement fees.
CFO Jamie Tomlinson said the Japanese debt market was found to be the most attractive option due to its limited exposure to sub-prime issues, the level of liquidity available, and the fact that Lion Nathan business was very attractive to these lenders.
"The deal attracted considerable interest and was significantly over-subscribed, demonstrating that Lion Nathan remains a highly regarded borrower due to its strong cash flow and disciplined capital management," Mr Tomlinson said.
There are 13 investors in the syndicate, of which no single investor holds more than 12% of the funds raised, Lion Nathan said, adding the syndicate included Japanese city banks, trust banks and regional banks.
"The funds can be drawn down at anytime over the next six months allowing us to replace a number of existing funding arrangements which mature during this period and will be used to support the group's ongoing funding requirements", Mr Tomlinson added.
Mr Tomlinson noted that the funding marked a return to the Japanese debt market for Lion Nathan after 20 years.
At 1037 AEST shares in LNN were down 3c to $8.67.