Security and guarantees for Dutch orders

IHC Merwede has been able to enter into a working capital finance agreement for €200m with a bank consortium formed by ABN AMRO, BNP Paribas, Deutsche Bank, ING and Rabobank to fund a large vessel build contract.

However, the banks are able to provide this kind of capital only because Atradius Dutch State Business covers the repayment risk through a working capital guarantee, the largest that has ever taken place on behalf of the Dutch Government.

The facility will be used by IHC Merwede to cover the construction costs of two pipelaying vessels for its Malaysian customer SapuraCrest. IHC Merwede’s president Govert Hamers said, “Apart from the technology at our disposal, being able to offer a financial package was decisive in securing this sale.”

The ships are part of a recent offshore order worth €450m and will install flexible pipelines in Brazilian waters, where large quantities of oil have been discovered. The delivery dates for the vessels, which will be built in the Netherlands, have been set for May and August 2014.

The guarantee has been developed through a very close cooperation with the Dutch Ministries of Finance and Economic Affairs, Agriculture and Innovation, banks and exporting business. The overall aim of this move has been to promote the provision of working capital to Dutch capital goods exporters, so that they can have access to the required financial resources. Since the introduction of this facility in 2010, hundreds of millions of Euros have been provided as coverage. However, this SapuraCrest order is the largest so far.

“The funding of this important transaction came about thanks to the joint efforts of IHC Merwede, its banks and Atradius, said Johan Schrijver, the CEO of Atradius Dutch State

Business. “Our coverage has made a competitive financing package possible, and due to this, the order has been awarded to a Dutch company. This puts our country on the map as an export nation.”