Trinidad Petroleum Holdings Ltd (TPHL) is set to receive up to US$720 million in term loans from a syndicate of banks led by Credit Suisse AG, Cayman Islands branch as global coordinator.
In a May 31 media release, TPHL is identified as the borrower while its subsidiaries – the Guaracara Refining Co Ltd, Heritage Petroleum Co Ltd and Paria Fuel Trading Co Ltd are the guarantors of the loan.The loan has been described as a “single syndicated amortising term facility” which may have multiple tranches, maturing as early as three years following the funding date. (A syndicated loan, also known as a syndicated bank facility, is financing offered by a group of lenders – referred to as a syndicate – who work together to provide funds for a single borrower.
The borrower can be a corporation, a large project or a sovereignty, such as a government.)The release stated the loan, together with funds from operations, would be used to repay, “at maturity, any 2019 notes that remain outstanding after its previously announced offers to exchange any and all of its outstanding notes for newly issued debt securities.”
“This includes the payment of any principal, premiums, accrued interest, additional amounts, if any, and costs and expenses incurred in connection therewith.” The first interest payment date of the new notes is September 15.
At the time of the press statement, TPHL had received over US$130 million from the loan facility. TPHL was established as part of the reorganisation of Petrotrin in December 2018.
A company source said they could not comment on the issue beyond that which was issued in the media release as the loan agreements are governed by the US Securities and Exchange Commission.
Meanwhile, on his Facebook page, former energy minister Kevin Ramnarine questioned the terms of the loan agreement and why current bondholders had not accepted the offer to exchange existing bonds for the new loan agreement.He said TPHL seemed to have “run out of confidence and goodwill with bondholders based on the poor acceptance of the exchange offer.”
“There were three extensions of the deadline for bondholders to accept the offer. The question is why were bondholders not interested? Clearly this didn’t go to plan.”
He said this may have led to the company seeking financing from the banks saying, “I wonder what those terms look like?”