India-focused energy firm Essar Energy Plc (ESSR.L) announced Wednesday that its subsidiary Essar Power Ltd has completed an 11 year Rupee bond offering of about US$125 million or Rs.7.5 billion in India.
This was the second of a number of Rupee bonds to be offered by Essar Power, which when completed will total about US$850 million or Rs.50 billion, the company said.
The company noted that the proceeds will be used to make repayments on existing loan facilities within the power business, particularly relating to its new coal fired power projects.
Essar Power was assigned a credit rating of A+ by ratings agency Credit Analysis and Research Ltd or CARE, of Mumbai, in October 2012 in respect of the proposed Rs.50 billion bond issue.
According to the company, the new bonds issued will be listed on the Bombay Stock Exchange and will be repaid from 2022 to 2024. However, it is currently intended that this bond issue will be refinanced with about.US$500 million or Rs.30.0 billion credit enhanced Rupee bond issue in due course.
Deepak Maheshwari, Essar Energy chief financial officer, said, "This bond issue will allow our power business to benefit from longer debt maturity timeframes and lower interest rates compared to our existing debt facilities. Essar Energy is well positioned to capitalise on the growing demand for power in India."
by RTT Staff Writer
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