Metsä Fibre €1.2 billion bioproduct mill project

Overview:

• Metsä Fibre, part of the Metsä Group, entered into a €1.2 billion financing arrangement with a consortium lenders to fund its new bioproduct mill in Äänekoski.
• It is the largest ever financing in the forestry industry in Finland.
• Nordea Bank served as the coordinator and agent alongside other lenders Finnvera, Exportkreditnämnden (EKN), Aktiebolaget Svensk Exportkredit (SEK) and the European Investment Bank (EIB).
• The new mill is scheduled to be completed in 2017.
• The total financing need of the project is projected to be €1.25bn, of which 40% is covered by the company and 60% by new debt.
• The €750m of new debt is comprised of a €400m loan from a group of Nordic banks, backed by a guarantee from Finnvera, a €200m loan from the EIB, an €80m loan from commercial banks and SEK and a further €70m loan from commercial banks and SEK, the latter backed by a guarantee from EKN. In addition, an existing undrawn €300m revolving credit facility was replaced as part of the financing package.
• The Nordic banks participating in the financing package are Danske Bank, DNB, Nordea, Pohjola, SEB and Swedbank.
• This is one of the first investment projects carried out in Finland after the change to the Finnish Export Guarantee Act 2014 that makes it possible for Finnvera - Finland's export credit agency - to participate in the financing of domestic investments that benefit exports. Previously, Finnvera could only be involved in export projects.

Wai Yee Tsang - Journalist