Refinancing of Syndicated Corporate Debt Facility

November 2015

Austal Limited (Austal) is an ASX300 global defence prime contractor and a designer and manufacturer of defence and commercial ships. On 20 November 2015, Austal announced it had successfully entered three year financing agreement with a syndicate of two major Australian and two major US banks, after a competitive tender process.

The multi-tranche, multi-option and multi-currency refinancing retained a similar structure to the existing facilities, and comprised three key components – a revolving credit facility, a contingent instrument facility and letters of credit. The letters of credit were used to provide credit support to Gulf Opportunity Zone Bonds (Go Zone Bonds), which are a form of tax-exempt indebtedness that was authorised by the US Federal Government to incentivise private investment in infrastructure in geographical areas that were affected by Hurricane Katrina in 2005. The Go Zone Bonds mature in 2041.

Azure was the independent financial adviser to Austal with regard to the refinancing, undertaking a full review of financing options available to Austal and running the competitive process which ultimately achieved more favourable and flexible terms compared to Austal’s previous facility, and improved pricing from the start of the process.