London/Mumbai: India-focused refiner and power generator Essar Energy Plc on Tuesday said it launched a $500 million, five-year convertible bond issue and would use the proceeds to pursue acquisition opportunities.
There is an option to increase the deal size by an additional $100 million and an over-allotment option of $75 million, which may take the total deal to as much as $675 million, the company said in a statement.
The coupon range for the offering is 3.75% to 4.25%, it said, adding Deutsche Bank, JP Morgan and Standard Chartered are the joint bookrunners for the issue.
This is the first such deal in several months from an Indian issuer and the second convertible bond from Asia, excluding Japan, this year.
Essar Energy, most of whose interests are in refining and power generation in India, said it would use the net proceeds primarily to pursue acquisition opportunities of power, coal, oil and gas assets. Essar Energy, which has a majority stake in India-listed Essar Oil, is in talks with Royal Dutch Shell about buying the Stanlow refinery in Britain.