Weiqiao Textile Said to Hire Two Banks for $100 Million Loan

By Katrina Nicholas

March 23 (Bloomberg) -- Weiqiao Textile Co., China's biggest cotton fabric maker, hired Mizuho Financial Group Inc. and Royal Bank of Scotland Group Plc to help it get a $100 million, three-year term loan, according to two people with knowledge of the matter.

Proceeds will be used to buy raw materials and refinance maturing debt, the people said, asking not to be identified as details are private.

The Hong Kong-listed company, which supplies cotton yarn and denim, has $118 million in loans maturing in 2012, according to data compiled by Bloomberg.

The facility will pay a top level, all-in fee of 220 basis points more than the London interbank offered rate, one of the people said. It may be increased by as much as $50 million if there is sufficient lender demand, the other person said.

Weiqiao spokesman Zhang Jinglei wasn't immediately available for comment.