Ril Raises $1.5 Billion With Its Third Bond Issue

RIL (Reliance Industries Limited) the countrys largest private sector company known

for its huge cash reserves and a Fortune 500 Global Company has proficiently raised $1.5 billion by means of an overseas bond sale program,during this weekend, according to two sources directly associated with the deal.

Including this debt raising, this conglomerate led by MukeshAmbanihas been successful in piling $ 4 billion in total during the entire year. The company previously raised a $1.5-billion issue in the month of February and an added $1-billion issue in May. RIL with a debt equity ratio of less than 0.5% is one among the least leveraged large-scale companies in the country. Its US subsidiary raised the first issue for its shale gas program and the second issue for $ 1 billion in May was entailing to the development of its Jamnagar Refinery complex. The present fund will be used to pay for the capital expansion program that was planned earlier. This syndicated loan will have maturities and is unsecured in nature. While the prices of the issue are not revealed, the $1 billion was a six year US Dollar money while the remaining caters to a 7.5 year money. It will be the first and the longest tenor for an unsecured syndicated loan by an Asian issuer this year.

Sold in North American, European, Asian and Australian markets, this instrument was seized by around 28 international and domestic banks including the renowned ones like Bank of America, the ANZ Banking Group, HSBC Group, State Bank of India, Bank of Tokyo Mitsubishi, RBS, etc. The i-Banking arms of these bankers have served to be merchant bankers of this deal.

Many companies including the domestic ones seem to be following the trend and have engaged in selling their debt in overseas market. SBI raised the second largest bond sale accounting for $1.25-billion bond, after RIL. EXIM banks stand at the third place with a $750-million debt sale that it received in two installments in the month of August and September. Some other companies who raise money from the foreign bond market include Bank of India, Syndicate Bank, IDBI bank, Union Bank, that have raised $ 3 billion in the last two months.

by: Chintan Shah

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