ProLogis European Properties, the European arm of logistics giant ProLogis, has completed a €900m refinancing.
The move will give confidence to the market that banks are willing to lend, despite the credit crunch, as long as the company in question is a high quality covenant.
The new senior unsecured credit facility was provided by a syndicate of 19 banks, headed up by Bank of America and ABN Amro. The facility can be expanded up to €1.15bn. It replaces ProLogis European’s existing €800m credit facility, due December 2007, and a €400m bridge facility, due January 2008.
The new facility comprises a €300m revolving credit facility due December 2010, a €300m term loan due December 2010, and a €300 term loan due December 2012. The average weighted interest margin on the new facility is 61 basis points over the European Inter Bank Offered Rate.
ProLogis European has already drawn down €384m under the new facility to repay its outstanding debt. It said that the new loan will be used to pay down more debt and to fund future investments in its ProLogis European Properties Fund II.
Vote of confidence
Peter Cassells, chief financial officer, said: ‘We are pleased to be able to report the closing of this new facility which increases the size of our credit line, lengthens the average term remaining on outstanding debt and allows us to continue to build on the financial and operational successes we’ve already achieved.
‘We are delighted with this vote of confidence from the global banking community as the facility was significantly oversubscribed, especially in the current difficult credit market.’