Singapore-based agribusiness major Olam Group has secured a 2.74-billion United Arab Emirates (UAE) dirham (approximately $745 million) loan for Olam Agri, its food, feed and fibre subsidiary.
Olam Agri subsidiaries Olam Global Agri Pte Ltd and Olam Global Agri Treasury Pte Ltd are also co-borrowers of the financing facility raised from banks in the UAE, the SGX-listed group said in a statement.
Proceeds from the loan, which has a tenor of two and a half years, will be used for refinancing Olam Agri’s existing loans for general corporate purposes.
Abu Dhabi Commercial Bank, First Abu Dhabi Bank (FAB) and Standard Chartered Bank are the senior mandated lead arrangers for the transaction, while Emirates NBD Bank is the mandated lead arranger, and FAB is the facility agent.
The new financing comes just days after the International Finance Corporation (IFC), a member of the World Bank Group, proposed a working capital loan of up to $200 million to Olam Global Agri. The IFC working capital loan will be used to purchase wheat, maize and soya for delivery to Olam Agri’s customers, and for processing operations in countries that rely on imports of these commodities.
Olam Agri’s products range from grains and oilseeds, animal feed and protein, rice, edible oils, and specialty grains and seeds, to cotton, wood products, rubber and commodity financial services.
The parent firm, Olam Group, provides food, ingredients, feed and fibre to 20,900 global customers across over 60 countries. It claims to be among the top 30 largest primary listed companies in terms of market capitalisation on SGX-ST.
Olam Group’s key shareholders are Temasek Holdings (51.1%), Mitsubishi Corporation (14.4%), and Kewalram Chanrai Group (6.8%).
Earlier in March, the firm said it planned to sell a 35% stake in Olam Agri to Saudi Agricultural and Livestock Investment Co for $1.24 billion, paving the way for a future IPO of the unit.
Meanwhile, Olam Group also delayed the IPO on the London Stock Exchange of its food ingredients unit, Olam Food Ingredients, which had been slated for Q2 2022.
Reuters had reported that the IPO could fetch about 2 billion pounds ($2.5 billion) to become one of the biggest offerings in London in years.