Vedanta Resources Issues Bonds Worth $900 Million
The funds raised from this bond issuance will be allocated to repay some of Vedanta’s existing bonds, including accrued interest and related transaction costs.
Vedanta Resources Finance II Plc. has announced the pricing of its bond offering.
The issue includes bonds totalling $900 million with a 10.875% interest rate and it will mature in 2029. This is Vedanta Ltd.’s first US dollar bond issuance since Feb. 2021.
These bonds, which have been issued by subsidiary Vedanta Resources Ltd., are backed by Vedanta and its wholly-owned indirect subsidiaries, including Twin Star Holdings Ltd. and Welter Trading Ltd., the company said in a statement on Wednesday.
The bonds are being sold through a private offering to qualified institutional buyers and to non-US investors via offshore transactions. The offering is set to close on Sept. 17.
The funds raised from this bond issuance will be allocated to repay some of Vedanta’s existing bonds, including accrued interest and related transaction costs.
Additionally, the bond’s interest rate of 10.875% is lower than the rate on the existing bonds that it will refinance, providing the company with a 3% in annual interest savings.
Approval in principle has been granted by the Singapore Exchange Securities Trading Ltd. for the listing and quotation of the bonds on the SGX-ST.
Barclays, Citigroup, Deutsche Bank, J.P. Morgan, and Standard Chartered Bank are serving as joint global coordinators and managers for the offering.
The bonds are anticipated to receive a “B-” rating from S&P Global Ratings upon closing.
The offering attracted final orders totalling $1.45 billion from global investors, resulting in a 1.6x oversubscription. The bond allocation included 41% from Asia, 24% from EMEA, and 35% from the US, with over 102 investors participating.
“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.” said Chief Financial Officer at Vedanta.
