Abu Dhabi’s ADQ taps banks for $1 bln Louis Dreyfus stake acquisition loan

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Abu Dhabi’s state-owned ADQ has lined up a small group of banks for a loan of about $1 billion to back its acquisition of a 45 percent stake in commodities trader Louis Dreyfus Co (LDC), three sources familiar with the matter said.

ADQ said in November it had signed an agreement to acquire an indirect 45 percent equity stake in LDC, in what would be the first outside investment in the family-owned commodity merchant’s 169-year history.

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The planned acquisition financing will likely be provided by a small group of banks including Emirates NBD, First Abu Dhabi Bank, Intesa Sanpaolo, and Natixis , two of the sources said.

Rothschild is advising ADQ on the fundraising, which will be finalized in the coming weeks, they said.

ADQ and Natixis did not respond to requests for comment. Emirates NBD, First Abu Dhabi Bank, Intesa, and Rothschild declined to comment.

Abu Dhabi has increasingly used ADQ to consolidate strategic assets. The company owns Abu Dhabi Ports, Abu Dhabi Airport and bourse operator ADX. It has also built up a portfolio of food and agriculture businesses and recently took a 22 percent stake in Dubai-based courier Aramex.

LDC declined to comment on ADQ’s financing of the deal. It said the timeline for closing was unchanged, with the deal still expected to close by mid-2021.

LDC has not disclosed the price for the deal, but specified that at least $800 million of the proceeds would go towards repaying a $1 billion loan LDC used to bail out Brazilian sugar and ethanol firm Biosev.

LDC, one of the world’s largest agricultural commodity merchants, agreed in a separate deal this month to sell Biosev to Raizen, a joint venture between Royal Dutch Shell Plc and Cosan SA.

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