WUXI, China, Sept. 8, 2011 // -- WSP Holdings Limited /quotes/zigman/491152/quotes/nls/wh WH +14.98% ("WSP Holdings" or the "Company"), a leading Chinese manufacturer of API (American Petroleum Institute) and non-API seamless casing, tubing and drill pipes used in oil and natural gas exploration, drilling and extraction ("Oil Country Tubular Goods" or "OCTG"), and other pipes and connectors, today announced that its wholly-owned subsidiary, Wuxi Seamless Oil Pipes Company Limited ("WSP China"), entered into a syndicated bank credit facility agreement with two major lead banks and six other participating commercial banks for up to RMB3.5 billion (approximately $547.9 million). Out of this amount, RMB2.86 billion (approximately $447.7 million) of the syndicated loan facility has been approved and made immediately available to WSP China, while the remaining balance of RMB640 million (approximately $100.2 million) is subject to the banks' further approval over the next three years.

The syndicated loan facility allows the Company to replace its existing short-term borrowings with mid-term working capital loans and helps the Company improve its current cash flow position and liquidity.

The credit facility consists of approximately 60% working capital loans and 40% trade financing facility. The term of working capital loans ranges from one to three years and bears an interest rate based on a 105% of the benchmark rate of People's Bank of China for similar loans. WSP China will be subject to continued compliance with certain bank loan covenants including maintaining certain required financial ratios and has pledged certain assets including land use rights and plant premises to the banks as collateral.

Source:marketwatch