Vedanta | (Photo: Reuters)
Vedanta Resources, the parent firm of mining conglomerate Vedanta Ltd, on Wednesday raised $900 million in its first dollar bond issue in more than two years to prepay existing bonds.
In a statement, the firm said it has raised $900 million at a coupon rate of 10.875 per cent in the five-year US dollar-denominated bond.
“The net proceeds from the offering of the bonds will be used to repay certain of Vedanta’s existing bonds (including any accrued interest thereto) and to pay any related transaction costs in connection thereto,” it said.
This is the first US dollar bond issued by Vedanta since February 2021.
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The bond received final orders of $1.45 billion from investors across the globe representing an oversubscription of over 1.6 times, reinforcing the confidence of these investors in the Vedanta story, the statement said.
“The final allocation of the bonds represented the broad-based support which Vedanta enjoys, including 41 per cent from Asia, 24 per cent from EMEA and 35 per cent from the United States and a subscription by over 102 investors,” it added.
The coupon rate of 10.875 per cent will lead to interest reduction compared to the dollar bond liabilities it would be refinancing, representing an interest saving of 3 per cent per annum.
“Vedanta Resources Finance II plc, a wholly-owned subsidiary of Vedanta Resources Limited, announced the successful pricing of the offering of bonds in the aggregate principal amount of $900 million of 10.875 per cent Bonds due 2029 on September 10, 2024,” the statement said.
The Bonds are being offered and sold in a private offering to qualified institutional buyers. The offering is expected to close on September 17, 2024, subject to customary closing conditions.
Barclays, Citigroup, Deutsche Bank, JP Morgan and Standard Chartered Bank are acting as joint global coordinators and managers.
“We are delighted by the overwhelming response to our bond issue. This reflects the significant confidence of global investors in the Vedanta growth story and the quality of our assets, our commitment and track record to deleveraging our balance sheet, strengthening our cash position, striving towards greater operational excellence, and consolidating for growth.
“Vedanta is confident of continuing to provide market-leading returns to all our global and domestic investors in the years ahead,” Vedanta said.
Vedanta Resources Finance II Plc is the finance vehicle for the Vedanta Group and a wholly-owned subsidiary of Vedanta Resources Limited. The Vedanta Group is a globally diversified natural resource group engaged in exploring, extracting and processing minerals and oil and gas.
It has operations in India, Namibia, Ireland, South Africa, Liberia, UAE, Zambia, Japan, South Korea and Taiwan, and is primarily engaged in the businesses of aluminium, zinc-lead-silver, oil and gas, copper, iron ore, steel and commercial power generation.
First Published: Sep 11 2024 | 8:05 PM IST
