OLAM Group’s indirect 64.6 per cent-owned subsidiary, Olam Agri, has secured a loan facility of US$550 million (S$743.7 million), said the group on Tuesday (Jun 25).
The revolving credit facility, which has a tenor of three years, was obtained by Olam Agri’s subsidiaries, Olam Global Agri and Olam Global Agri Treasury.
Proceeds from the facility will be used to refinance Olam Agri’s existing loans and for general corporate purposes, said the group on Tuesday (Jun 25).
It also noted that the facility was initially guaranteed by Olam Group but it will be transferred to Olam Agri, following Olam Agri’s planned initial public offering (IPO) and demerger from Olam.
In 2020, Olam announced a reorganisation of its business to create two new operating groups, namely Olam Food Ingredients and Olam Global Agri. It also disclosed its plans to maximise long-term shareholder value via carve-out and capital raising options, including the IPO of the two units on a sequential basis.
In January 2023, Olam said it planned to dual list Olam Agri in Singapore and Saudi Arabia, and demerge the agribusiness in the first half of the same year.
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But in May 2023, the group said that it did not expect the listing to be completed in the first half of 2023 as initially planned due to delays in approval processes.
Last August, Olam said it aimed to complete the IPO of Olam Agri by the first half of 2024.
Senior mandated lead arrangers comprise Deutsche Bank, JP Morgan Chase Bank NA, Cooperative Rabobank UA, Banco Santander and Credit Agricole Corporate and Investment Bank. HSBC was appointed as the facility agent.
Shares of Olam were up 0.9 per cent or S$0.01 at S$1.15 as at the midday break on Tuesday, before the group’s latest announcement.
