Adani Group News: Adani group to raise as much as $4.5 billion via a mix of offshore loans

The Adani Group, which not too long ago acquired Holcim’s native companies in India’s largest cement takeover, is in talks with greater than
a dozen foreign banks to lift as much as $4.5 billion by a mixture of abroad mortgage devices, a number of bankers conscious of the negotiations instructed ET.

This will likely be one of many largest loan-based fundraisings in international forex by an Indian company entity. Tenured devices, equivalent to bonds providing pre-specified coupons, are often bought abroad for elevating massive portions of money.

The proposed mortgage constructions embody mezzanine financing, stock-backed bridge loans to be repaid in money, and a senior debt facility for 18 months. The final of those structured devices might be refinanced later with both a long-term bond or mortgage.

Proceeds from the newest spherical of fundraising will likely be used to part-finance the acquisition of Holcim’s stakes within the two Mumbai-listed cement corporations – Ambuja Cements and ACC. Barclays, Deutsche Financial institution and Normal Chartered Financial institution earlier underwrote the entire funding traces.

These credit score traces at the moment are being break up, with a number of different abroad banks taking part within the transactions.

The Adani Group didn’t reply to ET’s queries. Particular person banks couldn’t be contacted instantly for feedback.

The senior debt facility will seemingly elevate as much as $3 billion, whereas the mezzanine line could elevate $1 billion. The bridge mortgage with one-to-three years maturities, is pegged at $500 million and could be repaid in money.

Bridge loans could be backed by shares of the 2 acquired cement corporations.

The mezzanine mortgage is proposed to be priced within the vary of 7-8%. The loans are anticipated to be priced after including 450 foundation factors to the Secured In a single day Financing Fee (SOFR), a world fee gauge that changed the London Interbank Supply Fee (LIBOR).

One foundation level is 0.01%.

High World Banks

A number of the banks concerned within the discussions embody

, Citi, JP Morgan, MUFG, Mizuho Financial institution, SMBC and some Center East-based lenders.

Mezzanine financing is a hybrid of debt and fairness financing that offers the lender the appropriate to transform the debt to fairness in case of default.

The group is at present exploring the capability of every financial institution to lend. Every financial institution could lend within the vary of $200-500 million.

“The Adani Group is trying to unfold the syndication initially restricted to solely three banks,” stated an government concerned within the course of.

Earlier, three banks underwrote the entire sum providing about $1.8 billion every.

“The borrower is now checking with every financial institution providing a number of choices to lift greenback funds,” stated one other government.

The Adani Group is buying the 2 corporations for $10.5 billion. The Adani Group is reportedly planning to usher in $3 billion as promoter fairness.

Swiss-based Holcim signed a binding settlement with the Adani Group for the takeover.

Holcim, by its subsidiaries, holds 63.19% in

and 54.33% in .

The open presents for the shareholders of Ambuja Cements and ACC will start from July 6 and shut on July 19, in keeping with a tentative schedule by the Adani household.

An open provide is triggered if an acquirer holds 25% stake or extra of a goal firm.