Recent Financing

India and overseas

REC raises $500 million through an overseas bond issue (India)

REC Limited has raised $500 million through the issue of overseas bonds. These bonds are direct, unconditional and unsecured obligations of the issuer and will rank paripassu among themselves and all other unsecured obligations of the issuer. The bonds will be listed on the London Stock Exchange’s International Securities Market, Singapore Exchange, India International Exchange and NSE IFSC. The bonds will mature on May 19, 2023 and all principal and interest payments will be made in US dollars.

NHPC raises Rs 7.5 billion through a private placement of bonds at 6.8 per cent

NHPC Limited has raised Rs 7.5 billion through a private placement of bonds at a coupon rate of 6.8 per cent per annum for a loan tenor of 10 years. The issue structure consists of a base size of Rs 5 billion with a greenshoe option of Rs 2.5 billion. The issue was oversubscribed 3.87 times.

ADB approves a $346 million loan for the power sector in rural Maharashtra

The Asian Development Bank (ADB) has approved a loan of $346 million to the Indian government for the provision of reliable power connections in the rural areas of Maharashtra. The loan will support the state government’s high voltage distribution system (HVDS) programme for new grid-connected rural agricultural customers across the state. The loan will be under ADB’s results-based lending modality, where funds disbursements are linked to the achievement of agreed programme results rather than to upfront expenditure, as is the case with traditional investment lending.

Siemens AG sells 24 per cent stake in Indian unit to group firm for Rs 85.2 billion

German conglomerate Siemens Aktien-gesellschaft (Siemens AG) has sold shares worth over Rs 85.2 billion in its listed Indian subsidiary, Siemens Limited, amounting to about 24 per cent stake, to another group firm, Siemens Gas and Power Holding BV. The overall holding of the parent group remains unchanged at 75 per cent. In 2019, Siemens AG asserted that it would carve out its gas and power business, which has weighed down its overall performance, into a separate subsidiary. Siemens decided to not demerge the gas and power business in India and instead transferred 24 per cent stake to the holding company for this business.

KPTL signs agreement to sell its entire stake in JKTPL

Kalpataru Power Transmission Limited (KPTL) has announced the signing of a share purchase agreement to divest its entire stake in Jhajjar KT Transco Private Limited (JKTPL) to India Grid Trust for an enterprise value of Rs 3.1 billion. JKTPL is a joint venture between KPTL and Techno Electric and Engineering Company Limited (TEECL), wherein KPTL currently holds 49.72 per cent equity. JKTPL own the first power transmission project secured by KPTL and TEECL on a design-build-operate-transfer basis. The project comprises three 400 kV power transmission lines and two 400 kV and substations in Haryana.

KPTL terminates deal to sell project to CLP India

KPTL has terminated the deal with CLP India to sell its transmission project, Alipurduar Transmission Limited (ATL), for not fulfilling certain conditions of the share purchase and shareholders agreement. KPTL had entered into binding agreements with CLP India to sell its stake in three power transmission assets for an estimated enterprise value of Rs 32.75 billion, on July 3, 2019. The three assets included ATL and Kalpataru Satpura Transco Power Limited and Kohima Mariani Transmission Limited.

L&T raises Rs 12.5 billion through NCDs

Larsen & Toubro Limited (L&T) has raised Rs 12.5 billion through the issuance of non-convertible debentures (NCDs). The company issued and allotted 12,500 unsecured redeemable NCDs of Rs 1 million each aggregating Rs 12.5 billion, carrying an interest rate of 7.2 per cent per annum, which will mature on April 20, 2023. The debentures are proposed to be listed on the National Stock Exchange of India Limited. Recently, L&T also raised Rs 38 billion through the allotment of 51,500 rated listed unsecured redeemable NCDs.

 Adani Group to retain its planned capex

The Adani Group has decided to retain its capex targets for 2020-21 and not make any cuts owing to the disruption caused by Covid-19. However, the group intends to start its capex plan from September 2020 instead of April 2020. The Adani Group had recently announced a capex plan of Rs 200 billion for two of its group companies, Adani Green Energy Limited and Adani Enterprises Limited.

Summit Gazipur II Power receives $140 million for an oil-fired power plant (Bangladesh)

Summit Gazipur II Power Limited, a subsidiary of Summit Power International, has secured financing of $140 million for the development, construction and operation of a 300 MW oil-fired power plant in Gazipur district of Bangladesh. The project will supply power to the Bangladesh Power Development Board under a 15-year PPA with a long-term fuel supply agreement with Summit Oil & Shipping. This transaction marks a significant milestone in Bangladesh’s project financing market as it is the first IPP to be financed solely by international commercial financing institutions.

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