RBS 1699-0511 Fiat CS5.indd by chenmeixiu

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									Case Study
Fiat Industrial motors on after demerger




The Client’s Requirement          Highlights
Fiat Industrial needed
standalone financing to support   • Fiat Industrial secured EUR4.2 billion of finance from eight lead banks
its demerger from Fiat S.p.A        demonstrating its standing as a sector champion. The subsequent
and allow it to operate as a        syndication attracted a wide range of international and domestic banks,
fully independent company           marking a successful debut for this newly established name

The Solution
                                  • Creating two stand-alone companies has given both entities the strategic
RBS part-underwrote and             flexibility to pursue further growth opportunities
structured a EUR4.2 billion       • A wide range of expertise was required to make this deal work, from
finance package consisting          advisory to Loan Syndicate
of a bridging term loan and
a three year revolving credit
facility (RCF)                    Fiat Industrial’s large industrial base, extensive     fact that it supported a demerger and, as such,
                                  product range and global presence qualify it as        the process relied on the contribution of various
                                  a global leader in the capital goods sector. Each      teams, ranging from Equity Capital Markets to
                                  of the Group’s businesses is a major international     Fixed Income Ratings Advisory.
                                  player in its respective industry sector: Iveco,
                                  CNH-Case New Holland and FPT Industrial. These         Ilaria Bertizzolo, Relationship Banker for Fiat, said
                                  three sectors design, produce and sell trucks,         RBS’s ability to call on this expertise was the key
 EUR 4,200,000,000
 Term Loan &                      commercial vehicles, buses, special vehicles           to clinching a lead role.
 Revolving Credit Facilities
 Underwriter, Bookrunner &        (Iveco), tractors, and agricultural and construction
 Mandated Lead Arranger
 December 2010 Italy              equipment (CNH), in addition to engines and            “We put together a big think tank on this, with
                                  transmissions for those vehicles and engines for       advice coming out of divisions who were never
                                  marine applications (FPT Industrial).                  accredited as part of the deal team. Fiat relied
                                                                                         on our loan markets guys to shape the combined
                                  Fiat Industrial came to life in January this year,     EUR4.2 million facility in a way that most effectively
                                  when the industrial activities of former Fiat Group    allowed the capitalisation of the new entity by
                                  demerged from the rest of the group and became         structuring its medium term asset/liability profile”
                                  a separate listed company valued at EUR12.6
                                  billion. The new business needed its own specific      Following the commencement of the bridging
                                  lines of finance and could no longer rely on           loan in January, RBS helped Fiat Industrial to
                                  facilities agreed by Fiat S.p.A.                       successfully raise EUR2.2 billion in the debt
                                                                                         capital markets using a dual tranche placing of
                                  A standalone finance facility for the new              fixed rate notes with maturities of four and seven
                                  company was structured by a group of eight             years. This allowed the bridging facility to be
                                  banks; in particular, RBS was responsible for the      refinanced, after just two months, leaving the
                                  preparation of the information memorandum, and         syndicated EUR2 billion RCF in place.
                                  managed the related flow of information amongst
                                  banks. The facility consisted of a three year          The Fiat Industrial deal has provided further proof of
                                  EUR2 billion RCF and a short-term EUR2.2 billion       RBS’s market-leading position in capital structuring.
                                  bridging loan which was put in place to allow Fiat     It is yet another example of RBS using its expertise
                                  Industrial time to raise money in the debt capital     to support its clients’ immediate objectives while
                                  markets.The RCF was then syndicated to a wider         also helping them plan for future growth.
                                  group of international banks while the bridging
                                  loan was retained by the eight arranging banks.        For more information about how we can
                                                                                         support your business needs, please contact
                                  The transaction was made more complex by the           your relationship manager.
                                                                                                                                                                        rbs.com/gbm




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1699-0511                                                                                                                                                                                 May 2011

								
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