Reliance hits overseas debt market again, raises $750 million in 30-year bonds

Reliance Industries Ltd (RIL) today said it has raised $750 million (about Rs4,624 crore) through issue of 30-year bonds to global investors in the overseas markets. The senior unsecured notes due to mature in 2045 were priced at 4.875 per cent, at a higher rate than the $1 billion it raised in bonds last month.

The notes have been priced at 262.5 basis points over the 30-year US treasury note, at a price of 98.865 to yield 4.948 per cent. The notes denominated in US dollars bear fixed interest of 4.875 per cent per annum, with interest payable semi-annually in arrears and ranks equal with all other unsecured and unsubordinated obligations of the company, it said.

RIL said the notes were subscribed over 3.07 times across 167 accounts with 47 per cent of the subscriptions coming from Asia, 8 per cent from Europe and 45 per cent from the United States.

In terms of investor distribution, 52 per cent of the notes were distributed to fund managers, 31 per cent to insurance companies, 8 per cent to pension funds, 6 per cent to central banks and sovereign wealth funds, 2 per cent to banks and 1 per cent to private banks.

RIL plans to utilise the funds for its ongoing capital expenditure.

This is the second time the company is hitting the overseas debt market over the past two weeks. Mumbai-based RIL had, on 22 January, announced the raising of $1 billion in 10-year notes, at an interest rate of 4.125 per cent. 

RIL had raised total of $3.3 billion in overseas debt in 2014.

RIL said the senior unsecured notes, due for redemption in 2045, have been assigned a rating of BBB+ (S&P) and Baa2 (Moody's). The company also claims to be the only issuer of 30-year overseas bonds in the Indian private sector.

This is the lowest coupon rate for a 30-year bond ever achieved by an Asian private corporate issuer, RIL said, adding that the issue was also the first ever single tranche 30 year deal by a private corporate issuer out of Asia.

RIL also claims to have opened the 30-year market for corporate issuances out of Asia in 2015

''We are delighted to continue to lead the way for Asian corporates to access long-term financing at attractive rates. Like our previous issuances, we were able to efficiently execute through an intra-day window, despite volatility in asset markets,'' V Srikanth, joint chief financial officer of RIL, said.

Bank of America Merrill Lynch, Barclays Bank Plc, Citigroup Global Markets Inc and The Hong Kong and Shanghai Banking Corporation Limited acted as joint book runners and lead managers.