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KME Group
MLAs: Deutsche Bank - structured commodity trade facility
GE Commercial Finance - factoring facility
Borrowers: KM Europa Metal AG (KME) and subsidiaries
Amount: Total e1.65 billion
Up to e850 million for SCF deal. Up to e800 million factoring
Tenor: 3 years and 5 years for the SCF facility and 5 years for the factoring facility
Type: Structured commodity finance facility + factoring facility
Legal counsel: Lovells
In a unique transaction in October 2006, European-based KM Europa Metal and subsidiaries (KME Group), one of the world's largest producers of copper products, secured financing from the trade market for a total up to a1.65 billion. The overall financing is comprised of two separate facilities, namely a structured commodity trade facility totalling up to a850 million, arranged by initial MLA Deutsche Bank; and an a800 million factoring facility arranged by GE Commercial Finance, in one of the largest such cross border arrangements the market has seen.
Acting as coordinating bank, agent, initial MLA, underwriter and joint bookrunner, Deutsche Bank arranged a syndicated debt facility of up to a850 million for KME. This is actually split into two tranches with tranche A being an up to $650 million three-year borrowing base facility, secured on inventory, and designed to allow flexible drawings on a revolving basis to provide headroom for KME's working capital. Tranche B of this facility is a...