Banque Audi finances Lafarge cement factory in Syria

Banque Audi finances Lafarge cement factory in Syria
Published: 29 July 2008

Lebanon’s Banque Audi has arranged a US$380m loan to French conglomerate Lafarge  to finance a cement factory in Syria, which suffers from shortage of the product, a bank executive said on Monday, reports Reuters.

The 18-month loan issued by a consortium of mostly Arab banks led by Banque Audi will be replaced upon maturity by a longer term loan, Bassel Hamwi, who runs Banque Audi’s Syria operation told Reuters.

"This is a bridge loan that will allow the structuring of a longer term project finance. Demand for cement outstrips supply in Syria and Lafarge has competent local partners," Hamwi said.

Hamwi declined to reveal the interest rate but said the loan covers 60 percent of the cost of the 2.9Mta factory, which is due to start production in 2010.

Lafarge will own 80 per cent of the factory. The rest will belong to the Syrian Tlas group, headed by the son of a former Syrian defence minister.

Syria recently opened up its cement sector to private investment after falling output from rundown government factories contributed to a housing crisis and lack of raw material for years.