GMR Infra refinances bridge loan with 5-year debt

BANGALORE: GMR Infrastructure said on Tuesday that it has refinanced its bridge loan of $737 million with a five-year debt. The company said the refinancing was done by a combination of senior and mezzanine debt from a consortium of banks led by Axis Bank and ICICI Bank, and comprising, among others, Bank of India, Bank of Baroda, Canara Bank, Exim Bank, Indian Bank, Indian Overseas Bank, and Syndicate Bank.

In October 2008, GMR successfully bid for a 50% stake in InterGen for $1.2 billion. A part of the acquisition cost was funded by the short-term bridge loan for two years.

“InterGen’s debt rollover was a huge liability on the company and it is a positive thing for the company that the debt was refinanced,” said Inderjeet Singh Bhatia analyst with Macquarie Research.

A recent report by Macquarie has stated that GMR’s management has indicated that InterGen will be consolidated in its financial statements from April 1, 2011. “We believe that this would lead the net debt: equity to rise from currently 1.8x to almost 3.6x. This is likely to have a lar ge impact on the incremental borrowing cost for GMR Infra,” the report said.

InterGen is a global power generation company with 12 power plants, with a total generation capacity of 8088 mw.