NEW DELHI :
Adani Ports and Special Economic Zone Ltd on Tuesday said it has begun a tender offer to buy back bonds worth $650 million due next year. The bond repurchase programme by the Adani group firm will close on 24 July, a company statement said. Adani Ports is buying back the $1,000 bonds at $1,009.5 each.
The company is also issuing new bonds of at least $650 million, proceeds of which will be used for the buyback of the bonds due in 2020.
“The tender offer is conditioned on the issuance of the new notes in a principal amount of at least $650 million on terms and conditions satisfactory to the company," the statement added.
On Tuesday, Fitch Ratings said it has assigned the port operator’s new bond issuance of $650 million an expected rating of ‘BBB-(EXP)’ with a stable outlook.
“Historically, the issuer has experienced throughput resilience in economic cycles. Adani Ports has some flexibility in modifying tariffs and around 14% of its revenue in the financial year ended March 2019 (FY19) was associated with long-term revenue-guaranteed contracts. The company has spare capacity and can fund its large capex plan from operational cash flow. Its debt structure is corporate-like, with spread-out bullet maturities,’ the rating agency said in a note.
The bond issuance and the bond repurchase programme follow last month’s $750-million offshore bond sale, which aimed to repay existing loans and finance capital expenditure.
Adani Ports claims to be the country’s largest port developer and operator with a 21.2% share of port capacity.
The company reported 18% rise in its debt to $3.9 billion in fiscal year 2019, compared with $3.3 billion a year ago, according to company data. The port operator’s profit remained almost flat at $579 million in FY19, compared to $573 million in FY18.
Several other Indian firms had also tapped the offshore bond market this year, following tepid fundraising activity in 2018. Indian firms had raised $6.3 billion through dollar-denominated bonds, down 51.7% from 2019, shows Thomson Reuters data.
For instance, GMR Hyderabad International Airport Ltd had raised $300 million through bonds in the offshore market to refinance debt of its parent, GMR Infrastructure Ltd.