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Friday, July 25, 2014
Mogi: DBM steps in where TDB couldn’t without a GoM guarantee
Development Bank of Mongolia out with $200m
The Development Bank of Mongolia is raising a $200m loan that features a $100m greenshoe option, made even more appealing with a guarantee from the country's government
By Shruti Chaturvedi
July 24 (GlobalCapital) Credit Suisse is the sole bookrunner for the deal, which is split into three portions: a three year bullet, which pays a margin of 425bp over dollar libor, a five year amortiser offering 437.5bp, and a seven year amortiser paying 450bp over libor.
Lenders are allowed to commit to any or all of the tranches, said a banker.
The deal is open to banks at three levels of participation - mandated lead arrangers coming in with commitments of $50m or over will earn 125bp as fees for the three year, 150bp for the five year and 175bp for the seven year.
Lead arrangers pledging between $25m and $49m earn fees of 110bp, 125bp and 150bp for the three tranches respectively, while co-arrangers committing between $10m and $24m net fees of 85bp, 100bp and 125bp, respectively
The fundraising comes just after the Trade & Development Bank of Mongolia had to pull a dollar bond issue when investors were reluctant to open their portfolios to Mongolian risk.
However, because the DBM loan comes backed by a guarantee from the government of Mongolia, it is unlikely to run into similar headwinds, according to bankers.
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