Adani Ports and Special Economic Zone, the Indian private ports operator that plans to raise USD650 million from its inaugural bond offering, has finalised the pricing of its senior unsecured notes, due 2020.
In a filing to the Bombay Stock Exchange today, the company said the offer price is USD99.524, which is 195 basis points over a five-year US Treasury Note. They will bear fixed interest of 3% with interest payable semi-annually. The offer is expected to close on 29 July.
The proceeds will be used to refinance foreign currency-denominated external commercial borrowings and fund capital expenditure.
Describing the price as “attractive”, Adani Group chairman Gautam Adani said that the fundraising exercise provided access to financing markets creating new “liquidity pools”. This would help reduce long-term borrowing costs and enable the mining and infrastructure major to set a benchmark for accessing bond markets in the future, he said.
Barclays Bank, Citi Group Global Markets, Emirates NBD PJSC, Merrill Lynch International, and SBICAP (Singapore) acted as joint bookrunners and joint lead managers for the transaction.
“Lenders in India are wary about funding infrastructure projects so raising capital in foreign currency is a serious option for companies such as Adani, who are focused on core infrastructure,” Manish Saigal, managing director of consultants Alvarez & Marsal India, told IHS Maritime. “Adanis have a strong footprint in running ports and have high visibility in the sector.”
Among the ports that Adani manages are Dahej in the western coastal state of Gujarat, Dhamra in Orissa state on the east coast, Hazira, Mundra, and Tuna-Tekra in Kandla. The group has also been awarded the proposed deepwater Vizhinjam port project in the southern state of Kerala.