Bloomberg News

Cnooc Said to Send Term Sheet to Banks for $6 Billion Nexen Loan

September 26, 2012

Cnooc Ltd. (883) sent documents to banks containing proposed terms for a $6 billion loan as it seeks to acquire Canada’s Nexen Inc. (NXY) in the biggest overseas takeover by a Chinese company, a person familiar with the matter said.

China’s largest offshore oil and gas explorer has approached a range of banks including lenders from Singapore, China, Australia, Europe and the U.S., the person said, asking not to be identified because the details are private. Citigroup Inc. is Cnooc’s financial adviser, the person said.

The Beijing-based company agreed to pay $15.1 billion in cash in July to acquire Nexen. The Canadian energy producer said last week that 99 percent of common shareholders voted in favor of the deal, which still needs approval from Canadian, U.S. and U.K. governments.

Michelle Zhang, a Beijing-based spokeswoman for Cnooc, couldn’t immediately be reached for comment on the financing when called and e-mailed at her office today.

Cnooc is offering to pay an upfront 25 basis-point fee for the 12-month facility with no limits on commitment size, the person said, citing details from the term sheet. The margin on the loan starts at 80 basis points more than the London interbank offered rate for the first six months, before increasing to 100 basis points for the next three months and 120 basis points for the final period, the person said.

Banks have been asked to respond by Oct. 16, the person said. Cnooc is considering eventually refinancing the bridge loan with proceeds from a bond sale, two other people familiar with the matter said Sept. 11.

To contact the reporter on this story: Katrina Nicholas in Singapore at

To contact the editor responsible for this story: Shelley Smith at

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