Shell Signs $15.3b Bridge Loan

Royal Dutch Shell (RDSa.L) has agreed a 10.07 billion pound ($15.28 billion) bridge loan from a group of relationship banks backing its 47 billion pound takeover of smaller rival BG Group (BRGXF) (BG.L), the company announced on Friday.

 

The two-year loan replaces a 3.025 billion pound interim bridge loan that was provided in early April by Bank of America Merrill Lynch.

 

The bridge loan will be used, along with existing cash, to cover the 13.2 billion pound cash portion of the cash and share deal.

 

Mandated lead arrangers on the financing are Banco Santander, Bank of America Merrill Lynch, Bank of Tokyo-Mitsubishi UFJ, Barclays Bank, BNP Paribas, CIBC, Citigroup, Credit Agricole (XCA.F) CIB, Credit Suisse, Deutsche Bank, HSBC Bank, JP Morgan, Lloyds Bank, Morgan Stanley (MS), Royal Bank of Canada (RY), Royal Bank of Scotland, Societe Generale (SGE.SG), Standard Chartered (SCBFF) and SMBC.

 

Each bank has committed 530 million pounds to the deal.

 

Barclays is facility agent on the transaction.

 

The financing pays an initial margin of 15bp over Libor, rising to 20bp after three months, to 25bp after six months, to 30bp after nine months, to 40bp after 12 months, to 50bp after 15 months, to 60bp after 18 months and to 70bp after 21 months.

 

There are also ticking fees of 20 percent of the applicable margin on undrawn, uncanceled amounts.

 

Shell is rated AA- by Standard & Poor’s, Aa1 Moody’s and AA by Fitch.