In a relatively uninspiring year in the Asian syndicated loan markets JP Morgan and DBS were able to bring a $600 million equivalent TMT financing to the market for Hanaro Telecom. The deal was noticeable from the outset as it became the first deal in Asia to be awarded following a proxy bid. Sponsors AIG and Newbridge gained the necessary shareholder support over a rival group containing LG, supported by Citibank, on October 21. The financing package totals $1.1 billion and includes a $450 million to $500 million equity injection from the sponsors. The loan is split between a W660 billion portion available in US dollars and Korean Won and a W60 billion tranche. In addition to being one the largest telco deal in Asia ex Japan, there were tight deadlines that had to be met for the fundraising to be successful. The initial underwriting had to be in place by mid November with ABN Amro, KDB and KEB signing up. Proceeds will provide a complete solution to the borrower, enabling it to address its maturing debt issues that comprise payments of some W1 trillion ($833 million) over the next 24 months. Additionally it provides funds for the potential W400 billion ($333 million) acquisition of Thrunet, another player in the Korean broadband market. It also allows for a great degree of flexibility with respect to repayment. The borrower can prepay and repay its existing debt under an extended availability period of two years. Market observers had suggested that the credit story may be a difficult one for the arrangers to sell. The borrower is competing with the number one player, KT Corp, who accounts for a large portion of the market. Furthermore investors have adopted a cautious view towards Korean corporates with SK Global impacting sentiment as well as the troubles effecting the credit card companies. Banks have also pointed to the unstable political conditions on the peninsular as another hindering factor. There were also many plus points for banks considering the deal. The experienced management team was retained under the takeover and the market has plenty of potential for further growth as well as the considerable yield pick up with US dollar lenders earning 340bp over Libor. The first phase of syndication began on October 21 with banks being invited into an expanded joint co-ordinating arranger group. A 100% hit rate was achieved at this level with a further six banks joining, creating positive momentum for the financing. General syndication was then launched and a further three banks came in by the official closing date of December 15. Two further banks are waiting for credit approval before formally committing to the deal. This response was encouraging considering the high risks that the transaction involves. The success proves that banks have the appetite for assets and this may pave the way for further financings of this nature in 2004.