Reliance raises $1 billion through overseas bond issue

February 10, 2012 2:57 pmComments OffViews:

Mumbai: Mukesh Ambani-led Reliance Industries Friday said its subsidiary, Reliance Holding USA, has issued bonds worth $1 billion to be used as capital expenditure.

“We are delighted to see the strong interest shown by high quality global investors in RIL’s credit. The transaction was well executed despite the short time-window and a volatile global environment,” said V. Srikanth, joint chief financial officer, Reliance Industries.

According to the company, Reliance Holding USA will utilise the proceeds from the bond issue to make business investments, refinance its existing debt and for general corporate purposes.

The notes were priced at 345 basis points over the 10-year US treasury note at a price of 99.481 percent to yield 5.468 percent.

The notes, which are denominated in dollar terms, will bear fixed interest of 5.400 percent per annum, with interest payable semi-annually in the form of arrear.

“The notes were distributed to high quality fixed income accounts with 65 percent given to fund managers, 15 percent to insurance funds, ten percent to banks, five percent to private banks and five percent to government agencies,” the company said in a statement.

The notes were distributed 31 percent in Asia, 17 percent in Europe and 52 percent in the United States.

“The transaction priced through RIL’s secondary curve and was nearly eight times over-subscribed with an order book aggregating US$ 7.8 billion,” the statement said.

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