AD Ports Group signed agreements with two UAE banks to refinance its syndicated loan of $2.25 billion at more favourable terms.
AD Ports Group said that the agreements will enable the Group to save up to AED 44 million ($12 million) in financing costs over the next 12 months.
Under the agreements, the Group’s $2.25 billion syndicated loan in April 2023 has been replaced by a $2.5 billion (AED 9.2 billion) medium-term facility with a 2.5-year maturity.
The new facilities will give the Group flexibility to optimally time its return to the debt capital markets in line with its stated strategy to use bonds as the predominant long-term funding vehicle.
The refinancing transactions followed Wednesday’s US Federal Reserve Bank decision to start its interest rate easing cycle, which was the first rate cut since March 2020.
The two new lending facilities also extend debt maturity to 2026 and beyond.
Martin Aarup, AD Ports Group Chief Financial Officer, said the new refinancing agreements give the Group greater financial flexibility to significantly lower the financing costs.
“It also gives us the timing flexibility and ability to optimally take advantage of the leasing interest rates cycle to eventually refinance the company’s needs in the debt capital markets at longer tenors and at competitive rates in line with our capital structure,” he said.
AD Ports Group is rated “A+” and “gcAAA” by S&P and “AA-” with a stable outlook by Fitch.
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