Macquarie Group Ltd. (MQG), Australia's largest securities firm, said it increased a syndicated loan by more than 10 percent to A$9 billion ($8.1 billion) after lenders offered more than it sought.
Macquarie hired 11 banks to arrange the loan, which was increased from A$8 billion, with 44 taking part, the company said in a statement today. The loan was used to set Macquarie Group as a new holding company in a reorganization of Macquarie Bank Ltd.
Increased aversion to risk during the crisis in credit markets has driven investors to investment-grade debt. The deal drew excess demand even when bankers of Wesfarmers Ltd. (WES), Australia's biggest home-improvement chain, are selling A$10 billion of loans, a record by an Australian borrower, to help fund the takeover of Coles Group Ltd.
``That this large facility was oversubscribed by such a distinguished group of Australian and international banks and investment banks reflects Macquarie's strong standing as a global financial institution,'' Macquarie Chief Executive Officer Allan Moss said in the statement.
Melbourne-based Macquarie, the world's largest private manager of infrastructure such as roads and airports, is stepping up expansion overseas after leading more than $30 billion of acquisitions abroad last year.
Macquarie Bank is creating a holding company to free its non-banking businesses from regulations that hinder it from raising capital.
Macquarie's loan includes A$5 billion of term loans and A$2.4 billion of revolving credit maturing in three, four and five years, according to the statement. Macquarie will also get an A$1.6 billion 364-day standby credit.
In a revolving credit facility, money can be borrowed again once it's repaid; in a term loan, it can't.
Macquarie Group has A$138.7 billion of total assets, according to the bank's Web site.
Macquarie Group is expected to be rated A-, the seventh- highest investment-grade, by Standard & Poor's, and one level higher at A2 by Moody's Investors Service.
Macquarie Group will separately get A$10 billion of short- term loans from Macquarie Bank, to be fully repaid within 24 months. The holding company will refinance the debt by turning to global capital markets, the company said on Sept. 14.
The arrangers including ABN Amro Holding NV, Australia and New Zealand Banking Group Ltd. and Barclays Plc (BARC), Commonwealth Bank of Australia (CBA), Dresdner Kleinwort Group Ltd., HSBC Holdings Plc (HSBA), JPMorgan Chase & Co. (JPM:US), Merrill Lynch & Co., National Australia Bank Ltd. (NAB), Royal Bank of Scotland Group Plc (RBS), and Westpac Banking Corp. (WBC)
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