HOCHTIEF Aktiengesellschaft secured a syndicated revolving guarantee facility on December 20, 2004. The facility was well received by the European banking market, with its 75 percent oversubscription prompting a volume increase to €1.65 billion from the €1.50 billion originally planned.
In obtaining the long-term guarantee line, HOCHTIEF gains extra flexibility to pursue its strategic goals while even better serving the specific operating needs of its businesses.
The HOCHTIEF transaction is unprecedented in the syndicated loans market. The guarantee facility chiefly serves to replace existing short-run guarantee lines and is a key element in the Group’s long-term financing. The facility secures the availability of guarantee lines to meet the needs of the HOCHTIEF Airport, HOCHTIEF Development and HOCHTIEF Construction Services Europe divisions. HOCHTIEF’s two major subsidiaries Turner and Leighton have their own credit lines.
The facility has a tenor of three years, after which HOCHTIEF has an option for two one-year extensions. Unlike previous transactions in the market, each member of the consortium will act as issuing bank under the facility.
The credit line is provided by an international banking syndicate led by ABN-Amro Bank N.V., HVB Group, Citigroup Global Markets Limited, Commerzbank Aktiengesellschaft, Deutsche Bank AG, Dresdner Kleinwort Wasserstein, DZ BANK AG Deutsche Zentral-Genossenschaftsbank, The Royal Bank of Scotland plc and WestLB AG.