Deal: Allen & Overy has advised the financiers to NBN Co Limited (NBN Co), Australia’s largest fixed-line broadband infrastructure company and primary wholesale high-speed broadband provider, on $6.1 billion of unsecured revolving bilateral facilities.

Value: $6.1 billion.

Area: Banking & finance, capital raise.

Key players: The transaction was led by Sydney banking partner Adam Stapledon and senior associate Victoria Eriksson with support from lawyer William Khun and graduate Brigitte Samaha. 

Deal Significance: NBN Co has secured access to a total of $6.1 billion from Australian and international banks, well above the $2 billion it had initially sought.

Finance Minister Mathias Cormann said the credit facilities “demonstrated… strong support in the market for the NBN business plan and outlook.”

He said the additional $4.1 billion – on top of the initial $2 billion NBN Co said it would need back in mid-2018 – had been secured “at very competitive prices” and via “arrangements with a number of Australian and international banks”.

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“There is no requirement for NBN Co to draw down on these additional facilities immediately, but the [government] agrees with the company that it makes sense to have these facilities in place, to give it flexibility and given current economic conditions,” Mr Cormann said in a statement.

Mr Stapledon said on the transaction that Allen & Overy was pleased to support the financiers involved in this credit arrangement, despite the challenges posed by the COVID-19 pandemic.

Of the $6.1 billion, NBN Co “is expected to draw down $2 billion”, given those funds were needed to cover increased build costs caused by past delays to the HFC rollout and fixed wireless congestion remediation.

“The additional funding will provide the company opportunities to invest and create even more value for Australians guided by future corporate plans,” Communications Minister Paul Fletcher said.