RIL’s $ 4 billion foreign exchange bond issue is India’s largest

Mumbai: Reliance Industries (RIL) raised $ 4 billion in the largest sale of foreign currency bonds by an Indian firm. He raised $ 1.5 billion over 10 years, $ 1.75 billion over 30 years and $ 750 million over 40 years. It had recently received board approval to raise up to $ 5 billion in foreign bonds to take advantage of the low interest rate environment and to refinance existing borrowing. The bond issue has been underwritten nearly three times with a peak order book totaling $ 11.5 billion. The bonds were bought by investors from Asia (53%), America (33%) and Europe (14%).
It was India’s largest foreign exchange bond issue, RIL claimed, eclipsing the earlier record set by energy giant ONGC Videsh when it raised $ 2.2 billion in dollar banknotes in 2014. Bharti Airtel had raised $ 1.25 billion in 2021, which was the biggest debt problem. Last year.
The foreign currency bond issue was the largest transaction in the debt capital market at $ 4 billion and the “tightest credit spreads between each of the long-term tenors for all companies in India” said Srikanth Venkatachari, deputy chief financial officer of RIL. “The support received from major international capital market investors reflects the strength of our underlying business with established growth platforms in energy, consumer and technology, as well as the strength of our balance sheet. . ”
RIL did not disclose the names of the bondholders. But, industry sources said subscribers included Fidelity, Pacific Investment Management Co (Pimco), Goldman Sachs Asset Management (GSAM), Metlife, Eastspring, NeubergerBerman, Blackrock and Lombard Odier. The bonds will be listed on the Singapore Stock Exchange. Industry watchers said the RIL hit a low interest rate, with investors betting on India’s growth, among other factors. “Despite a very competitive schedule at the start of the year, RIL printed the lowest 30-year coupon ever and the lowest re-offer spread ever on a 10-year bond from an Indian issuer,” said said Kaku Nakhate, director of Bank of America India.
Citi India CEO Ashu Khullar agreed with Nakhate. “RIL achieved the lowest coupon for the 30 and 40 year benchmark issues of any private sector company in the BBB space from Asia, excluding Japan. It is also India’s very first 40-year issue to take advantage of the current low interest rate environment to extend debt maturity, ”said Khullar.