United Stainless Steel Company
Project
Bahrain-based United
Stainless Steel Company (USCO) has signed a facility agreement with Arab
Banking Corporation (ABC) as sole underwriter and mandated lead arranger
for a $153 million senior debt facility.
The facility will be used
to part finance the construction of a 90,000 tons per year cold rolled
stainless steel mill in Hidd, Bahrain.
USCO was established in
February 2005 and construction commenced in April 2005. Production is
scheduled to start in April 2007. It will be the first company of its kind
in Bahrain and the region, with the closest similar facilities being in
Europe (Italy) and South Asia (India).
USCO is one of the major
industrial projects in the region, with an investment of more than $200
million. It is the third major investment in Bahrain by Gulf Investment
Corporation (GIC). The other two investments are Gulf Industrial
Investment Company (GIIC) and Al- Ezzel Independent Power and Water Plant.
The project has brought
together several strategic GCC private and public sector investors,
namely:
Gulf Investment Corporation (GIC)
National Industries Group (NIG)
Al Kharafi Group
Kuwait Foundry Company (all based in Kuwait)
Qatar Steel Company (Qasco) of Qatar
United Gulf Industries Corporation (UGIC) of Bahrain
and Al Rashid Group of Saudi Arabia.
Hisham Al-Razzuqi, CEO of
GIC said that the project will create employment opportunities for 220
people, of which over 50 per cent will be Bahraini citizens, and will
benefit the economy of the country and the region.
Al-Razzuqi also highlighted
that as an industrial venture, USCO is strong proof that the GCC
economies, despite their relatively small market size, can support
industrial projects that utilise the competitive advantages of the region
to penetrate markets beyond their borders.
The USCO project is well
structured, including long-term raw material supply and off-take
agreements. This has been reflected in the strong investor interest as
represented in USCO shareholders list. The risk profile allows the project
to be financed on favorable terms.
The senior debt facility
will be made available by ABC for participation by other financial
institutions in a limited syndication to be launched shortly. |
