Citgo to launch $1.85 billion credit facility

By Sara Rosenberg

New York, Oct. 14 - Citgo Petroleum Corp. is scheduled to hold a bank meeting on Monday afternoon at the Four Seasons Hotel in Houston to launch its proposed $1.85 billion senior secured credit facility, according to a company spokesman.

BNP Paribas and JPMorgan Chase Bank are the lead banks on the deal.

The facility consists of a $700 million seven-year term loan B and a $1.15 billion five-year revolver, the spokesman said.

Price talk on both tranches is expected to be in the Libor plus 150 to 175 basis points context, a market source added.

Proceeds will be used to refinance the company's existing credit facility and to fund the cash tender offers for any and all of its $150 million 7 7/8% senior notes due 2006 and $250 million 6% senior notes due 2011. The company also plans to redeem its other senior notes and its notes issued under a master shelf agreement of about $194 million.

Citgo is a Houston-based refiner, transporter and marketer of transportation fuels, lubricants, petrochemicals, refined waxes, asphalt and other industrial products.

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