* Benefits from strong market
* Lenders also want to stay in favour with oil powerhouse
* Latest borrowing smaller than expected
By Michelle Meineke and Isabell Witt
LONDON, Jan 25 Rosneft has requested
better terms on part of its financing to buy TNK-BP, banking
sources said on Friday, taking advantage of strong market
conditions and the desire of lenders to stay in favour with the
Russian oil powerhouse.
Rosneft, which will be the world's largest listed oil
producer after the acquisition, has cut 10 basis points (bps)
from the interest margin of a $13 billion loan, the second part
of a $29.8 billion financing package for the $55 billion
purchase of its Russian rival.
"Rosneft's price cut is a token amount and it should not
fundamentally change lenders' analysis, plus people have to make
an overall call on their relationship with the borrower," one
banker close to the deal said.
The reduction reflects strong market conditions in Central
and Eastern Europe where borrowers can achieve more favourable
terms from international banks fighting for market share after
weak deal flow in 2012.
The change in pricing will be formally confirmed after banks
have submitted commitments next week. All banks are expected to
accept the new pricing, a second banker said.
The borrowing is smaller than a $15.7 billion loan that was
originally discussed because a UK bank declined to participate,
Rosneft, which is buying 50 percent of TNK-BP from AAR, a
consortium of four Soviet-born tycoons, raised $16.8 billion in
December to buy BP's half of the venture.
The latest borrowing consists of a term loan and bridge loan
to a bond issue. The term loan is priced at 200 bps after the
cut and the bridge loan is priced at 140 bps.
Rosneft could not immediately be reached for comment.
Bank of Merrill Lynch and Citigroup are co-ordinating both
stages of the jumbo loan.. Neither bank would
The latest financing is expected to sign by mid-February at