The goal of WACKER’s financing strategy is to ensure sustainable growth and stability for the Group. This strategy comprises both financing through our own resources and the use of debt instruments.

We satisfy our capital requirements with operating cash flow, and short-term and long-term financing.

We ensure the Group’s permanent solvency via rolling cash-flow management, and adequate credit lines guaranteed in writing. Financing requirements are calculated for the entire Group, with funding usually being granted at Group level. Project-specific or regional funding is available in special cases.

Financing Measures in 2013

The Group took several financing measures in 2013. Due to them, the Group has covered its financing requirements for the coming years, gained new lenders and optimized the maturity schedule and term structure of its borrowings. In April 2013, Wacker Chemical Corporation (Adrian, Michigan, USA) sold securities in a private placement in the USA for a total amount of US$ 400 million, guaranteed by Wacker Chemie AG. Repayment is divided into installments of five years (US$ 70 million), seven years (US$ 130 million) and 10 years (US$ 200 million), each at a fixed interest rate. The liquidity inflow occurred on April 23, 2013. This was WACKER’s first private placement in the USA. In June 2013, Wacker Chemie AG took out a fixed-rate loan for € 50 million (five-year maturity) with LfA Förderbank Bayern, a development bank for Bavarian companies. This loan replaced one for the same amount that fell due in June 2013.

Financing Measures in 2013

Wacker Chemie AG also took out a loan for € 80 million with the European Investment Bank in July 2013 to finance research and development costs at Siltronic. This loan can be drawn in four installments and matures in six years. The maturity period commences when the first installment is drawn.

For all the loans that we negotiate, we structure the agreements carefully to ensure that the financial partners are treated equally (pari passu) and that the agreements can subsequently be monitored groupwide. WACKER pledged its investment in a joint venture to cover that company's financial liabilities. Some of the liabilities to banks are fixed-interest while others have variable interest rates. As of December 31, 2013, WACKER had unused credit lines of around € 700 million with terms of over one year. The measures concluded contain standard market credit terms and a net debt-to-EBITDA ratio as the only financial covenant.

WACKER collaborates with a number of banks (core-bank principle), who must have an investment-grade credit rating and a long-term business model. To minimize counterparty and concentration risks, no one bank’s share in credit lines committed to WACKER must exceed 20 percent. The only exception is the European Investment Bank.