Epiroc’s financial risk management is centralized to benefit economies of scale, to ensure good internal control and to facilitate monitoring of risk.
The central treasury function is responsible for the Group’s borrowing, liquidity management, currency and interest rate risk management, and serves as an internal bank for the Group.
Debt is primarily raised by the parent company Epiroc AB and transferred to subsidiaries as internal loans or capital injections. Financing is also undertaken locally, in countries which there are legal restrictions preventing financing through Group companies.
As per end of February 2019, the bridge facility amounting to SEK 6,000 million, which the Group entered into in connection with the listing on June 18 2018, had been fully replaced.
The long-term financing consists of capital market borrowings of SEK 2,000 million (maturity in 2023), a loan facility from Swedish Export Corporation (SEK) and Svenska Handelsbanken (SHB) of SEK 2,000 million (maturity 2023, with two one year extension options), a loan from the European Investment Bank (EIB) of EUR 100 million (maturity 2022) and a loan facility with Nordic Investment Bank (NIB) of SEK 1,000 million (maturity 2027).
A revolving credit facility (RCF), of SEK 4,000 million, is available to be used for general corporate purposes and as a backup facility. The maturity is five years with the addition of two one-year extension options, exercisable at the first and secondary anniversary of the RCF, subject to the consent of the lenders. The facility was entered into by Bank of China, Citibank, Danske Bank, Deutsche Bank, Nordea, Skandinaviska Enskilda Banken, Standard Chartered Bank, and Svenska Handelsbanken. The Group also have a Swedish commercial paper program available, with a framework amount of SEK 2,000 million.
Epiroc EMTN programme
Epiroc has a €1,500,000,000 Euro Medium Term Note Programme.
Epiroc was assigned preliminary BBB+ credit rating from S&P Global Ratings on November 21, 2018. On December 5, 2018, Epiroc was assigned a BBB+ long-term issuer credit rating and a BBB+ rating to the SEK2 billion senior unsecured bonds that Epiroc issued on November 29, 2018.