IL&FS arm becomes fourth Indian firm to sell dim sum bonds
Subsidiary raises 575 million yuan by selling bonds to investors in Asia
Mumbai: ITNL International Pte. Ltd, a subsidiary of IL&FS Transportation Networks Ltd (ITNL) on Thursday became the fourth firm from India to raise yuan funds, raising 575 million yuan by selling bonds to investors in Asia. The securities, also know as ‘dim sum’ bonds, have a three-year maturity.
Mukund Sapre, executive director at IL&FS Transportation Networks, confirmed that his firm had closed the issue which opened earlier on Thursday.
“These proceeds would be used to refinance the loan that the firm had taken for its operational road project in China. This refinancing is resulting into about 8% savings for the firm," Sapre said.
Barclays Plc and CLSA Ltd were the bankers to the issue.
“The issue opened earlier today with a guidance of 8.37% but the issue was finally priced at 8%. This bond will be listed in Hong Kong and the proceeds will be used to pay off existing debt of the company," said a banker familiar with the deal on Thursday.
ITNL joins its sister firm IL&FS Financial Services Ltd and local lenders IDBI Bank Ltd and ICICI Bank Ltd which have raised yuan bonds since the government allowed Indian firms to tap this growing source of finance in September 2011.
“The issue managed to collect a total of 2.1 billion yuan from investors who were all from Asia," said the banker quoted above. He spoke on the condition of anonymity.
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