Bharti raises nearly $2b in dual currency bond sale

India's biggest telecom firm Bharti Airtel today raised about $2 billion in a dual currency international bond sale, saying it is the largest debt issuance by a domestic firm till date.

Bharti raised $1 billion and Euro 750 million from sale of dual currency $and EUR bonds, which will be used for repayment and refinancing of existing foreign currency debt.

Airtel said it is a first ever dual currency issuance by an Indian issuer and also largest ever fund raising exercise at a single time by an Indian issuer.

The company said in a statement that its wholly-owned subsidiary Bharti Airtel International (Netherlands) has successfully priced a dual currency issuance of guaranteed senior notes comprising of $1,000 million 5.350 per cent notes due 2024 and Euro 750 million 3.375 per cent notes due 2021.

"The notes will be fully and unconditionally guaranteed by Bharti Airtel. Bharti will apply the net proceeds to refinance its existing debt," the statement added.

The $notes were oversubscribed 8 times and saw participation by over 550 accounts whereas the Euro bonds were oversubscribed 5.3 times and saw participation by over 400 accounts, the company said.

"The $notes have been priced at 270 basis points over 10 year $Treasury with a fixed coupon of 5.350 per cent per annum to yield 5.361 per cent," the company said.

It added the Euro notes have been priced at 225 basis points over 7 year EUR Mid Swaps with a fixed coupon of 3.375 per cent per annum to yield 3.498 per cent.

The company said this refinancing exercise has significantly lengthened the average maturity profile of Bharti’s debt.

"With this, the company has fully refinanced the original $9 billion acquisition facility and also taken care of all near term maturities," it said.

The net debt of the company at the end of March 31, 2014 stood at Rs 60,541.6 crore.

"With this transaction, Bharti is the single largest private issuer out of India. We now have $5 billion of bonds outstanding, across 5,6, 7, 9 and 10 years outstanding tenor across USD, EUR and CHF currency base," Bharti Airtel Group Treasurer Harjeet Kohli said.

Barclays, Bank of America-Merrill Lynch, BNP Paribas, HSBC, JP Morgan and Standard Chartered Bank acted as joint lead managers for the offering.

"Through this as well as the previous bond issuances, all acquisition finance facilities taken for the acquisition of Zain in 2010, have been successfully refinanced well ahead of their tenure," Kohli added.

In March this year, the company had raised around Rs 2,453.2 crore through issue of bonds in the Swiss market.

In December 2013, the Sunil Mittal-led firm had raised euro 750 million (about Rs 6,350 crore) in the first such bond issue by an corporate and received bids worth euro 3.8 billion.

The company than re-opened the issue in January and raised 250 million euros.

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