Eastern Europe's deal of the year?
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Eastern Europe's deal of the year?

The biggest debt deal of the year from eastern Europe wasn't the Yukos loan, or the Poland dollar deal, or even the Gazprom blowout. For once, the banks involved don't want to tell you how well it went, and it probably doesn't appear on any league table. That's because it's an arms financing deal, one of the biggest private financings of this type for several years.

In November 2002, Poland agreed to buy 48 F-16 jets from Lockheed Martin, through the US government's foreign military sales programme. The aircraft were to modernize Poland's ageing air force, in order to make a good contribution to Nato's combined forces, of which Poland is a relatively new member. In March 2003 the financing for the deal was finalized, with JPMorgan arranging a $5.5 billion facility, guaranteed by the US government, at an interest rate, according to one banker, of Libor plus 10 basis points. This was syndicated to several US and European banks in March, through a US special purpose vehicle, according to a banker who worked on the deal. JPMorgan did not return calls to comment.

Fortuitous repayment holiday

According to the term sheet, which Euromoney has seen, the deal was structured in two options - a $1.9

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