Debt raising for an International Steel Trader
Our consultant identified that his employer was a peripheral non-core bank in the overall financing requirements of this ASX listed corporate. As a result the bank’s share of the ancillary wallet was limited as were the future possibilities for growth. Overall income from the client was below AUD500k.
The challenge was to increase the importance of this financier to the client. After discussion the client suggested that more ancillary wallet could be tendered if the size of the balance sheet commitment was increased. The target was to increase from AUD70m to AUD300m, which would elevate this bank to the third largest facility provider to the Group.
Or consultant led the internal negotiations which saw AUD100m offered in each of 3 countries which matched the clients operational needs.
Ancillary opportunities were presented and won over a period of time including, trade services, foreign exchange and cash management. This result in revenue to the bank growing over a four year period to c.AUD9.5m per annum. During this period the debt facilities were materially unutilised but clearly demonstrated the liquidity available to the company. A top level bank/client relationship was established that benefitted the interest of both parties.