RIL hits overseas debt market again, may raise USD 1 billion

Mumbai: Reliance Industries has hit theforex debt market second time in as many weeks to raise about USD 1 billion in a benchmark 30-year dollar-money note sale to  international investors. On January 22, the company had raised USD 1 billion by selling 10-year bonds at an interest rate of 4.125 per cent,  which the company claimed was the lowest in Asia and with  almost no new-issue premium. In 2014, the company had raised over USD 3.3 billion in forex debt. 

"Reliance is in the market with a benchmark issue to  ell 30-year US dollar-denominated Reg S fixed rate senior  unsecured notes. The company has given an initial price  guidance of 285 bps above the 30-year US treasury bills/ The  company may raise up to USD 1 billion," said multiple sources at merchant bankers working on the issue, requesting  they not be named. 

Company officials could not be reached for the comment.  They also said the benchmark issue could be as large as  USD 1 billion and will be priced tonight after the New York markets open, and will be listed on the Singapore Exchange.  The lead arrangers to the issue are Barclays, HSBC and  Citi, among others. 

The issue has been rated Baa2 by Moody's Investors Service with a stable rating and the proceeds from the issue  will be used to fund the company's capital expenditure of Rs 1.8 trillion over the next few years. "RIL's Baa2 rating reflects its leading market position, globally competitive refining business which has  consistently commanded higher margins than its competitors, and vertically-integrated operations across the hydrocarbon  chain. The rating also recognises RIL's moderate financial leverage, strong operating cash flow and excellent liquidity,"  says one of Moody's vice presidents and senior credit officers  Vikas Halan in a note offering the rationale for the rating.