Vedanta raises nearly $1.4 billion in overseas bonds

Mumbai: Billionaire Anil Agarwal-controlled Vedanta Resources raised about $1.4 billion in overseas bonds to help fund the proposed delisting of its holding company listed in India.

The company offered 13 per cent for the three-year bonds. The process of pricing was on until publication of this report. These bonds are reportedly backed by Vedanta Ltd shares. Vedanta Holdings Mauritius II Ltd, a wholly owned step-down subsidiary of Vedanta Resources, issued those debt securities.

Although these bonds are of a different structure, the rates offered were 300-400 basis points less than the secondary market levels with three-year residual maturities. In the offshore secondary market, a particular series of bonds sold by Vedanta Resources Plc would be yielding 16.53 per cent. Those papers will mature in April, 2023.


“Although the rate was not phenomenally high given the secondary levels, they reflect the seriousness of the company selling the bonds,” a European investor having business interest in the Vedanta Group told ET.

The borrower obtained about $2.25 billion subscription demand but retained less.

On August 4, ET wrote about the proposed offshore bond sale plan. Standard Chartered, JPMorgan, and Deutsche Bank were among the bankers that helped the company raise the money.

Global rating company Moody’s assigned the bonds a B3 rating with negative outlook, a rating five-six notches lower than the investment grade.

Moody's views the privatization as credit positive.