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Gunvor signs US$1.3bn credit facility

Global commodity trader Gunvor’s US subsidiary has closed the syndication of its borrowing base credit facility, drawing in US$1.33bn from a group of more than a dozen lenders.

Proceeds will be used to refinance Gunvor USA’s existing borrowing base facility, signed in October last year, providing continued working capital for the firm’s merchant activities and for general corporate purposes.

The deal also includes a US$500mn accordion feature, which remains available to support future growth.

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Four banks act as joint lead arrangers. Rabobank also serves as administrative agent and active bookrunner, while ING Capital, Natixis and Société Générale act as bookrunners and co-syndication agents.

Credit Agricole CIB, SMBC and MUFG are co-documentation agents, while the syndicate is further backed by a diverse group of nine additional returning lenders. When contacted by GTR, a Gunvor spokesperson said the facility was oversubscribed, but was not immediately able to provide the names of the other banks involved.

The agreement marks the fifth renewal and expansion of the firm’s original US borrowing base facility, launched in 2016 at US$500mn.

Major commodity players have continued to attract sizeable levels of financing, despite reports of banks continuing to limit their exposure to smaller and mid-sized traders in the wake of a string of fraud scandals and losses in 2020.

Business has boomed for larger players such as Gunvor, which reported a record gross profit of US$1.66bn last year.

Houston-headquartered Gunvor USA is a wholly owned indirect subsidiary of the Gunvor Group, and is focused on the marketing and trading of physical refined products, crude oil, renewables, natural gas and power.

The wider Gunvor Group has also raked in funding from global banks in recent months, announcing in July it had signed a US$872.5mn off-balance sheet facility with a 24-bank syndicate in a bid to diversify its financing sources.

Law firms involved in the latest Gunvor USA deal include Zukerman Gore Brandeis & Crossman, which will serve as counsel to the administrative agent, and counsel to the borrower, McGuireWoods.

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