Greenko Dutch BV on Monday priced its five-year and seven-year dollar bonds to raise $1 billion, sources said.
The bonds are being issued in two tranches. One tranche consists of a 5NC2 bond – a bond with tenure of five years that can be called only after two years – while another is a 7NC3 bond which means the bond has a tenure of seven years and can be called only after three years.
The seven-year bond, which had an initial price guidance at 5.5%, received a final price guidance at 5.25%, while the five-year bond, which had an initial price guidance at 5.125%, received a final price guidance at 4.875%, according to the source.
The bond is a Reg S/144 A issue which means investors from the United States are also allowed to participate apart from those in Europe and Asia. At the time of going to the press, the US markets were yet to open and hence the deal was yet to be priced.
“Even before the US markets opened, we received orders over $2 billion. Raising a billion dollar and that too by with the price getting tightened means the issue received a tremendous response. This is the kind of response you would generally find for a high-rated state owned bank or a big oil company,” said a banker close to the deal.
Moody’s Investors Service had earlier assigned a provisional (P)Ba2 rating to the proposed 7-year dollar-backed senior unsecured notes.
GDBV is a special purpose vehicle which will use the proceeds from the notes to subscribe to senior secured INR non-convertible debentures (NCDs) to be issued by each of the other Restricted Subsidiaries in the restricted group (RG3), which are wholly-owned/majority-owned by GEH, Moody’s had said in the release.
“The proceeds from the NCDs will be used to refinance the existing debt of the restricted subsidiaries, including the existing USD550 million notes due 2019, project finance debt and shareholder loans associated with the operating projects that the parent transfers to RG3,” the release stated.
Fitch Ratings has assigned Greenko Dutch BV’s proposed US dollar senior guaranteed notes an expected rating of ‘BB-(EXP)’.