Anil Ambani-led Reliance Communications Ltd’s submarine cable subsidiary Global Cloud Xchange has raised $350 million through five-year bonds in the international markets, as per a press release.
Of the total money raised, $250 million will be used to refinance the Standard Chartered Bank loan facility, the company’s arm Reliance Globalcom BV had availed. Remaining will be used for capital expenditure and general corporate purposes.
“The deal received an overwhelming response from the market and was significantly oversubscribed,” RCom said in a statement.
By geography, the new issue was allocated 22 per cent in the US, 29 per cent to Europe and 49 per cent to Asian investors. By investor type, the issue witnessed 78 per cent allocation to fund managers, 13 per cent to hedge funds, 6 per cent to private banks, and 3 per cent to other investors. The notes are expected to settle on August 1, 2014.
Deutsche Bank and Standard Chartered Bank acted as joint global coordinators.
The notes were priced at 100 per cent with a coupon and yield of 7 per cent. The notes will be rated B2 by Moody’s and BB+ by Fitch, and the company is rated B2 Stable by Moody’s and B+ Stable by Fitch.
Reliance Communications has a net debt of around $6.5 billion and is the most leveraged listed telecommunication company in India. The company is bringing down its debt burden by selling its telecom tower assets.
(Edited by Joby Puthuparampil Johnson)