Fibria Advances Project Financing

    SAO PAULO, BRAZIL, October 02, 2015 /24-7PressRelease/ -- The forestry company is seeking up to $500m in a long-term loan format, from Finnvera, BNP Paribas, HSBC and Nordea in a deal structured by Cayman Islands based TGX Capital. The Finnish ECA signed an intention letter for the credit, which will likely have a 10-year tenor. Fibria is acquiring equipment from Finnish, Austrian and Swedish manufacturers.

In addition, the borrower applied to BNDES and Midwest Development Fund (FDCO), for BLR1.5bn ($360m) and BLR1bn ($240m), respectively, in funding. Both Brazilian development institutions are now processing and analyzing the documentation. Approval for these loans is expected by the end of November.

"Fibria is going through a very good moment, despite a general deterioration of Brazil's economy," Habibe said. "The markets are confirming such perception. We were able to price our recent $400m export pre-payment facility at 143bp over Libor [average cost], at the beginning of September, the same margins we negotiated in November. Additionally, our bonds are the second best traded in Brazil and our shares have doubled in value in the last twelve months, increasing by 70% since the start of the year."

The company signed a $400m pre-payment loan in December, which included a five-year, $150m bullet tranche paying 140bp over Libor.

Horizonte 2 will expand the production capacity of Fibria's pulp production Tres Lagoas unit in the state of Mato Grosso do Sul. The new production line will be capable of producing 1.75m tons of pulp per year, increasing total production to 7m tons.

TGX Capital is a Cayman Islands based private fund that structures large scale project financing by injecting collateral loans into approved projects.

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