Fortescue Said to Hire Five Banks to Arrange $1.5 Billion Loans
May 18, 2011, 4:42 AM EDTBy Sarah McDonald
May 18 (Bloomberg) -- Fortescue Metals Group Ltd., Australia’s third-largest iron ore exporter, hired five banks to help it obtain $1.5 billion of loans, according to a person familiar with the matter.
Bank of America Merrill Lynch, Royal Bank of Scotland Group Plc, Deutsche Bank AG, JPMorgan Chase & Co. and Credit Suisse Group AG are arranging the debt, the person said, asking not to be named as the details haven’t been made public.
Fortescue, based in Perth, will use part of the funding to help pay for the $8.4 billion expansion of its Pilbara iron ore operations, according to a filing yesterday to the Australian stock exchange. The project will almost triple Fortescue’s output, helping meet demand for ore from steel mills in China, the world’s fastest-growing major economy.
Fortescue is seeking a $1 billion term loan and a $500 million revolving three-year facility, it said yesterday. The proceeds from the term loan will fund the expansion while the revolving loan will be used for general corporate purposes, according to the filing.
--Editor: Garfield Reynolds, Ed Johnson
To contact the reporter on this story: Sarah McDonald in Sydney at smcdonald23@bloomberg.net.
To contact the editor responsible for this story: Shelley Smith at ssmith118@bloomberg.net.
