Essar in talks for $900 mn loan: sources

Essar in talks for $900 mn loan: sources
Comment E-mail Print Share
First Published: Thu, Jun 18 2009. 09 11 PM IST
Updated: Thu, Jun 18 2009. 09 11 PM IST
Mumbai: India’s Essar Group plans to raise $900 million (Rs4,329 crore) through a two-year loan by pledging a part of its stake in the country’s third largest mobile firm, Vodafone Essar Ltd, two people with direct knowledge of the deal, said.
SBI Capital Markets Ltd, a unit of top lender State Bank of India, and Barclays Capital are in the race to arrange the funds and could end up sharing the deal, the banking officers said, declining to be named.
Both the lenders are in discussions with Essar at a rate below 11%, they said, adding that the funds could be arranged in the next two weeks. “We have got a commitment for a majority of the required funds from institutional investors and banks,” said one person, who is directly involved in the deal. “They are looking at two-year money and we are offering a range of 10-10.5%,” the second person said.
Essar Teleholdings Ltd, which owns a third of unlisted Vodafone Essar, will pledge about 11% of its holding to raise the money, the people said. They said Essar Teleholdings, which controls the group’s telecom holdings, would use the money to invest in group businesses that span telecom, steel, shipping, oil and construction.
feedback@livemint.com
Devidutta Tripathy in New Delhi contributed to this story.
Comment E-mail Print Share
First Published: Thu, Jun 18 2009. 09 11 PM IST
More Topics: Essar | Loans | SBI | Shares | Vodafone Essar |