RLPC-Linde exploring 1.5 bln euro loan extension - banks

LONDON, May 22 (Reuters) - German industrial gases producer Linde (LING.DE) is talking to banks about extending the maturity of 1.5 billion euros ($2.07 billion) of loans with a forward start agreement, three bankers close to the talks said on Friday.

Linde is trying to extend the maturity of part of an existing 2 billion euro revolving credit that matures in 2011 by a further two years, two bankers said.

"The terms of the deal are under discussion," a banker close to the deal said.

Linde declined to comment.

Forward start facilities allow borrowers to lock in loans ahead of maturity in return for increased margins and fees.

Linde, which is rated BBB+ by Standard & Poor's and Baa1 by Moody's, was originally considering a series of bilateral loans, but instead opted for a syndicated loan, two bankers said.

The company faces an increase in borrowing costs to more than 200 basis points (bps) over EURIBOR, one banker said, up from around 55 bps on the 2 billion euro loan it took out in 2006 which partly financed its acquisition of BOC Group.

Linde said that it had net debt of 6.5 billion euros as of March 31 at a road show in London in May. The company referred to a 2 billion euro committed credit facility, 847 million euros of cash and short-term financial debt of 1.156 billion euros.

Linde's 2006 acquisition financing was arranged by a group of banks including Commerzbank, Deutsche Bank, Dresdner Kleinwort, Morgan Stanley and Royal Bank of Scotland, Thomson Reuters LPC data shows. (Reporting by Zaida Espana & Tessa Walsh; additional reporting Peter Maushagen in Munich; Editing by Rupert Winchester)