Reliance raises $4 billion in overseas bonds

RIL raised $1.5 billion in 2.875 per cent senior unsecured 10-year notes due 2032; $1.75 billion in 3.625 per cent senior unsecured 30-year notes due 2052 and $750 million in 3.750 per cent senior unsecured 40-year notes due 2062.

The notes have been priced at 120 basis points, 160 basis points and 170 basis points over the respective US Treasuries benchmark, RIL stated, adding that the notes are rated BBB+ by S&P and Baa2 by Moody’s.

RIL said the notes were nearly three times oversubscribed with a peak order book aggregating $11.5 billion and were priced through RIL’s secondary curve.

RIL now joins a select group of issuers from Asia to have made jumbo bond issuances.

This transaction is the largest ever foreign currency bond issuance from India. The notes have the tightest ever implied credit spread over the respective US Treasury across each of the three tranches for an Indian corporate.

These are also the lowest coupon achieved for benchmark 30-year and 40-year issuances by a private sector BBB corporate from Asia ex-Japan as also the first ever 40-year tranche bond by a BBB private sector corporate from Asia ex Japan, according to RIL.

Interest on the notes will be payable semi-annually in arrears and the notes shall rank pari passu with all other unsecured and unsubordinated obligations of RIL, the company stated. 

RIL proposes to use the bond proceeds primarily for refinancing existing borrowings. 

The company said the notes received orders from over 200 accounts in Asia, Europe and the United States. In terms of geographic distribution, the notes were distributed: 53 per cent in Asia, 14 per cent in Europe and 33per cent in the United States.

The notes were distributed to high quality fixed income accounts: 69 per cent to fund managers, 24 per cent to insurance companies, 5 per cent to banks and 2 per cent to public institutions.

“We are extremely pleased with the strong outcome on our multi-tranche long dated dollar bond issuance, having issued not only the largest debt capital market transaction at $4 billion but also the tightest credit spreads across each of the long-dated tenors for any corporate in India,” Srikanth Venkatachari, joint chief financial officer of RIL, commented. 

“The support received from the marquee international capital market investors is reflective of the strength of our underlying businesses with established growth platforms across energy, consumer and technology as well as robustness of our balance sheet. This issue continues the tradition of Reliance being a sophisticated and innovative issuer across the capital structure,” he added.

BoFA Securities, Citigroup, and HSBC acted as joint global oordinators. BofA Securities, Citigroup, HSBC, Barclays, JP Morgan and MUFG acted as joint active bookrunners. 

ANZ, BNP Paribas, Crédit Agricole CIB, DBS Bank Ltd., Mizuho Securities, SMBC Nikko, Standard Chartered Bank and State Bank of India, London Branch acted as Joint Passive Bookrunners.