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Reliance Industries Ltd on Friday announced that its wholly-owned subsidiary, Reliance Holding USA, has raised another $500 million through a bond (Guaranteed Senior Notes) issue.
The issue was priced at 325 basis points over the 10-year US Treasury Note to yield 5.267 per cent.
Earlier on February 10, RIL using the similar route had raised $1 billion. The new issue would be guaranteed unconditionally by RIL.
The issue will bear a fixed interest of 5.400 per cent a year, with interest payable semi-annually in arrears. Reliance Holding will use the net proceeds to fund its ongoing capital expenditure, refinance its existing debt and for general corporate purposes.
The present transaction was over-subscribed approximately 7.5 times with an order book aggregating $3.73 billion. This transaction was done through nearly 213 accounts in Asia, Europe and the US. About 50 per cent of the subscription came from US market, while 31 per cent was from Asia and 19 per cent from Europe.
Commenting of the issue Mr Rajiv Nayar, MD and Head of Capital Markets Origination at Citi India, said that given the strength of RIL's credit, the tap was priced with no new issue premium but through the secondary curve. A tap is reopening of existing notes. It gives issuers the option to upsize the original offering at a more attractive price level, he said.
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