RLPC-UPDATE 2-BHP Billiton's acquisition loan totals $45 bln

Wed Aug 18, 2010 11:36am EDT

* Six banks lead $45 bln loan for BHP Billiton

* Five banks underwriting loan

* Bond refinancing expected after anti-trust clearance

By Alasdair Reilly & Tessa Walsh

LONDON, August 18 (Reuters) - BHP Billiton (BLT.L) (BHP.AX) has arranged a syndicated loan of $45 billion to back its hostile bid for Canada's Potash (POT.TO), market sources said.

Six banks are leading the financing, which has been unequally underwritten by Banco Santander, Barclays Capital, BNP Paribas, JP Morgan and Royal Bank of Scotland, a banker close to the deal said, adding that TD Securities is acting as mandated lead arranger and bookrunner.

BHP Billiton has locked up its lenders with a financing exclusivity agreement, two of the bankers said.

BHP said earlier on Wednesday it has a "new multi-currency term and revolving facility agreement entered into for the purpose, among other things, of meeting the funding requirements of the transaction." [ID:nSGE67H031]

Further details of the jumbo loan financing are expected to be included in a filing to the U.S. Securities and Exchange Commission on Friday, which will outline the terms of BHP's offer, one banker said.

BOND REFINANCING

The deal, which will carry a pricing premium due to its size, will be refinanced with bond issues after the deal receives regulatory clearance, the banker said.

Bankers do not expect significant anti-trust issues and said there is a decent chance that the acquisition could close before the end of the year.

Although a deal of this size could challenge loan market capacity, bankers expect it to be well received. BHP is viewed as a good credit with ancillary business and has a track record of treating its banks well, they said.

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