PDVSA Refinancing $1.125bn Loan

Venezuela’s state-owned oil company PDVSA is looking to refinance a $1.125bn 1-year facility it took out in January. The existing financing, led by BNP Paribas, pays Libor plus 100bp, and PDVSA will look to refinance at similar terms, according to bankers close to the process. It was tightened from an initial 115bp launch following an upgrade. A bank meeting is scheduled for November 26 in New York and BNP is again leading the process. Given today’s market conditions, PDVSA may find it difficult to clinch the kind of pricing it would have got just a few months back. A margin above 100bp looks likely. Credit committees have become more risk averse and syndicators are finding their home offices are far more willing to veto deals with risky profiles at a time that their own cost of funds is rising. On PDVSA’s current facility ABN AMRO is an MLA with a $175m ticket, followed by arrangers BLADEX, with a $130m ticket, and Banco do Brasil and JPMorgan, each with $100m tickets, according to Dealogic. PDVSA has ratings of BB minus/B1.