Mercuria, one of the world's top five energy traders, has raised almost $1.1 billion (701.8 million pounds) through a revolving credit facility (RCF) and the sale of U.S. oil and gas assets, bolstering its balance sheet for future growth, its chief executive said on Thursday.
Marco Dunand told Reuters Mercuria Energy Trading's Singapore unit was about to close the books on a $745 million RCF with 28 banks, 19 of them Asian, in a financing exercise that had been subscribed 1.5 times.
Mercuria has separately agreed to sell interests in oil and gas properties in Bakken, North Dakota to Kodiak Oil & Gas Corp
Dunand said Mercuria had also had approaches from potential investors, including sovereign wealth funds, and might consider selling up to 20 percent of its equity to one or two investors by the end of next year if they found the right partner.
Mercuria, founded seven years ago and now with a turnover of around $75 billion, would strengthen its balance sheet with the capital raising at a time of tightening global credit, and look for opportunities for acquisitions, Dunand said in an interview.
With so much uncertainty around, there is a thought that maybe it is not a bad idea to have good access to cash, he said. We believe the money raised can be used to buy other things and next year there may be increased opportunities to acquire other assets, although I am not sure where.
So we are happy to keep our powder dry and have sufficient cash in case it's needed, Dunand said.
Banking sources told Reuters last week Mercuria's two-tranche RCF would be increased to $745 million from $480 million and around 20 banks, with a mix of Asian, Middle Eastern and European banks included.
The RCF is split into two tranches: $535 million for one year and a three-year tranche of $210 million.
Dunand said the total amount raised could eventually exceed $745 million because a 29th bank had come in at the last moment for the three-year portion.
This has exceeded our expectations as we went to market looking to raise an original $500 million, Dunand said.
In a statement on November 14, Denver, Colorado-based Kodiak said it would buy properties in the Williston Basin in North Dakota from an undisclosed seller for $590 million in cash and stock to expand its presence in the region.
(Reporting by Christopher Johnson; Editing by Keiron Henderson)