REC Raises 650 Million USD from Global Medium Term Programme under REG S Bonds Issuance
- PRICING OF USD 650 MILLION3.375% FIXED RATE SENIOR UNSECURED DOLLAR NOTES OF 5-YEAR TENOR -
REC Limited has successfully raised USD 650 million (INR 4,450 crore), 5-year bond from REG S Bonds under the established Global Medium Term Programme of USD 5 billion. Proceeds of the bond will be used to finance power projects in accordance with the approvals granted by the RBI from time to time and in accordance with the ECB Guidelines.
The 5-year REG S Bond has a semi-annual coupon of 3.375% per annum and a maturity date of 25 July 2024. It offers investors a reoffer spread of 167.50 basis points over the 5-year UST.The transaction saw an oversubscription of more thanfourtimes with active participation from more than 140 major international investor accountsallowing it to price inside its current market levels with the tightest coupon ever on its five-year USD bond.
The Initial Price Guidance was 195 basis points over the five-year US Treasury.
REC decided to upsize the deal to USD 650mn from the earlier benchmark target to accommodate keen investor interest in the issuance from REC Limited. The final Order Book has been over $2.70 billion from over 140 accounts across the globe with Asia accounting for 63%, EMEA 37%
REC’s bonds opened for subscription on Thursday across global centres subsequent extensive road show in Asia and London. The transaction evidences strong demand and confidence from investors around the globe towards REC Limited’s differentiated credit despite the weaker emerging market headlines and some concerns on Indian NBFI sector
This demonstrates a very strong investor appetite for India sovereign-linked paper, at a very tight pricing.Barclays, DBS Bank Ltd., HSBC, MUFG and Standard Chartered Bankare the joint bookrunners for the issue.