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Yancoal affiliate NCIG closes US$634 million debt refinancing
Newcastle Coal Infrastructure Group (NCIG) has reached financial close on a US$634 million bank debt refinancing of its coal export terminal at the Port of Newcastle in Australia.
Michael Marray 19 Jul 2017

Newcastle Coal Infrastructure Group (NCIG) has reached financial close on a US$634 million bank debt refinancing of its coal export terminal at the Port of Newcastle in Australia.

NCIG is 27% owned by Yancoal, alongside four other shareholders, BHP Billiton, Whitehaven Coal, Peabody Energy, and Centennial Coal. NCIG owns and operates a group of coal export terminals, rail lines, storage and other facilities.

According to a company statement, the primary purpose of the transaction was to refinance US$450 million of bank debt maturing in March 2018. Due to strong lender demand the facility was upsized to refinance further debt. Each of the facilities’ six existing banks participated in the new five-year facility at current or higher hold levels, with two new commercial banks joining the lender group.

The transaction continues NCIG’s proactive approach to managing its capital structure and taking advantage of constructive and supportive debt markets that enable extension of its maturity profile at competitive rates. NCIG continues to monitor debt markets that enhance the capital structure and cost of funds.

“We are very pleased with the refinancing, which is competitively priced, broadens our lender base, and increases our average debt tenor, with our next debt maturity now being in March 2019,” says John Kite, CFO of NCIG, which is rated BBB by Standard and Poor’s.

Yancoal and its associated companies have had strong support from bank lenders for their ambitious expansion plans in Australia. In addition to the big four Australian banks, Commonwealth Bank of Australia, ANZ, National Australia Bank and Westpac, there have also been commitments from Chinese banks including Bank of China

Yancoal Australia is a subsidiary of Yanzhou Coal Mining Co, which is in the midst of acquiring Rio Tinto’s Australian coal assets, Coal & Allied. Yanzhou looked set to get the deal done when Glencore Plc came in with a rival offer, forcing Yanzhou to increase its own bid. At the end of June Rio Tinto shareholders approved the transaction with Yanzhou, at a sale price of US$2.69 billion.

Photo: NCIG.com.au

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