Reliance Industries is in talks to raise as much as $2.25 billion (Rs 15,300 crore) in what could be one of the biggest offshore debt issues by an Indian corporate as the energy-to-retail conglomerate seeks to replace existing high-cost borrowings as well as build a war chest for its aggressive expansion strategy in telecom.
At least 10-12 investment bankers are involved and marketing roadshows are expected to start soon in North America, Europe, the Middle East and Asia, several people with direct knowledge of the matter told ET.
The money is proposed to be raised through external commercial borrowings (ECBs), they said. It may be a syndicated loan. Securities may be priced 90-100 basis points over the London Interbank Offered Rate (Libor). The US 12-months Libor is now at 1.70 per cent. A basis point is one-hundredth of a percentage point.
The company raised Rs 30,000 crore last year through a rights issue in two parts, in January and September. Earlier this month, the company said it would raise another Rs 30,000 crore through a rights issue of optionally convertible preference shares to invest in Reliance Jio Infocomm, the telecom unit.
"We expect a lot of action from Indian corporates, especially the larger ones, as the offshore debt market is much more attractive now," said a person working on the fund-raising plan.
"We don't know what will happen after a month, when Trump takes over and makes tough decisions. Reliance's big move could be a fresh debt or to refinance an existing debt with a cheaper one, but definitely the process is on the fast track," said a person working on the fund-raising plan.
Reliance, which operates the world's biggest oil refinery complex in Jamnagar with a capacity of 1.24 million barrels per day, has already invested $25 billion in setting up a nationwide, fourthgeneration mobile network. While announcing third-quarter earnings earlier this month, the company said it is planning to invest another $4.4 billion to enhance network capacity as it competes with Bharti Airtel and Vodafone. Reliance Industries declined to comment on the matter.
Reliance Jio has been adding about 6 lakh users per day and has about 7.2 crore subscribers after having launched commercial operations four months ago, the company said.
At least 10-12 investment bankers are involved and marketing roadshows are expected to start soon in North America, Europe, the Middle East and Asia, several people with direct knowledge of the matter told ET.
The money is proposed to be raised through external commercial borrowings (ECBs), they said. It may be a syndicated loan. Securities may be priced 90-100 basis points over the London Interbank Offered Rate (Libor). The US 12-months Libor is now at 1.70 per cent. A basis point is one-hundredth of a percentage point.
The company raised Rs 30,000 crore last year through a rights issue in two parts, in January and September. Earlier this month, the company said it would raise another Rs 30,000 crore through a rights issue of optionally convertible preference shares to invest in Reliance Jio Infocomm, the telecom unit.
"We expect a lot of action from Indian corporates, especially the larger ones, as the offshore debt market is much more attractive now," said a person working on the fund-raising plan.
"We don't know what will happen after a month, when Trump takes over and makes tough decisions. Reliance's big move could be a fresh debt or to refinance an existing debt with a cheaper one, but definitely the process is on the fast track," said a person working on the fund-raising plan.
Reliance, which operates the world's biggest oil refinery complex in Jamnagar with a capacity of 1.24 million barrels per day, has already invested $25 billion in setting up a nationwide, fourthgeneration mobile network. While announcing third-quarter earnings earlier this month, the company said it is planning to invest another $4.4 billion to enhance network capacity as it competes with Bharti Airtel and Vodafone. Reliance Industries declined to comment on the matter.
Reliance Jio has been adding about 6 lakh users per day and has about 7.2 crore subscribers after having launched commercial operations four months ago, the company said.
