Vedanta unit accepts bids worth $1.75 billion for three-tranche dollar debt, bankers say

A subsidiary of UK-based Vedanta Resources has accepted bids worth $1.75 billion for a three-tranche issuance of dollar bonds, as it seeks to refinance high-yielding outstanding debt, three merchant bankers said on Friday.

Vedanta Resources Finance II ‌has raised $500 ⁠million ⁠through six-year bonds at a coupon of 7.00%, $700 million through eight-year bonds at a 7.3750% coupon, and $550 million through 11-year bonds at a coupon of 7.75%, the bankers said.

The pricing was 25 basis points below the initial guidance of 7.25%, 7.6250% and 8.00%, ⁠they added.


The ‌bankers requested anonymity as they are not authorised to speak to the media, while ⁠the company did not respond to a Reuters email seeking comment.

The bonds will be guaranteed by the parent firm as well as subsidiaries Twin Star Holdings, Welter Trading and Vedanta Holdings Mauritius II. The notes are expected to be rated Ba3/BB-/BB, in line with the issuer.

Proceeds will ‌be primarily be used to refinance higher yielding debt worth over $2 billion.

The company aims to buyback outstanding $550 million ⁠of the 9.475% 2030 bond, $500 million of the 11.25% 2031 paper, $500 million of the 9.125% 2032 bond and $550 million of the 9.85% 2033 notes.

In October, the unit had raised $500 million, selling seven-year dollar bonds at a coupon of 9.1250%, and this is one of the papers that it intends to repurchase.