The board of Export-Import Bank of the US has voted to extend the single largest financing transaction of $2.1 billion to Reliance Industries Ltd. This includes a $1.06-billion direct loan and to guarantee a $1.06-billion JP Morgan Chase loan to the company.
The loan will be primarily used to finance goods and services procured from exporters and suppliers in the US as part of Reliance’s expansion projects at Jamnagar, Gujarat.
In a statement, Ex-Im Bank said this was in continuation of its efforts to support American jobs by boosting American exports. The credit is for the export of American goods and services destined for use in Reliance’s expansion projects at Jamnagar.
Stating that the transaction was the single largest Ex-Im Bank has ever authorised for Reliance, the deal represents the company’s first attempt at funding through the capital markets with an Ex-Im Bank guaranteed bond issuance.
The credit is expected to support approximately 12,300 US jobs, according to bank estimates derived from Departments of Commerce and Labour data and methodology. Moreover, six per cent of the financing is expected to support American small businesses.
“This transaction is a tremendous opportunity for US exporters and US jobs,” said Ex-Im Bank Chairman and President Fred P. Hochberg, in a statement.
Alok Agarwal, Reliance’s Chief Financial Officer, was quoted in a media statement as saying, “We are once again partnering with major US suppliers for cutting edge technology, critical project management services and equipment from a wide section of American exporters for rolling out our next phase of growth.” Among the more than 65 exporters and suppliers involved in the transaction are Fluor Corporation, Lummus Technology, Univation Technologies LLC, Bechtel, and ConocoPhillips.