Fortescue Metals Group will price its proposed $US1 billion ($938 billion) six-year term loan at a margin of between 375 to 400 basis points over the London interbank offered rate, according to Standard and Poor’s LCD.

JPMorgan, Credit Suisse, Bank of America Merrill Lynch, Deutche Bank and RBS are lead managers of the transaction. Fortescue’s term loan will have a margin floor of 100 per cent over Libor, and will be non-callable for two years. Proceeds from the unsecured term loan will be used to fund the company’s $US8.5 billion mining production expansion. Fortescue is also negotiating a three-year, $US500 million senior unsecured revolving credit facility for liquidity and general corporate purposes.