Bharti Airtel is looking to raise 350 million Swiss Franc (around $400 million) through bonds. This is the second overseas bond issue by an Indian company this year and is the largest bond deal by an Indian entity in the Swiss debt market.
The bond issue is rated BBB- by Fitch and Standard and Poor?s, and Baa3 by Moody?s. It carries a coupon rate of 3%. The bond?s tenure is six years and lead managers of the issue are Deutsche Bank, UBS and BNP Paribas. The issuer of the bond will be Bharti Airtel International Netherlands and Bharti Airtel Limited will be the guarantor. The bonds will listed on the Swiss Stock Exchange.
Sources in Deutsche Bank said that the issue saw well-diversified demand from insurance institutions, private banks and pension funds.
Earlier in 2013, Bharti Airtel?s bond issue for $1.2 billion was one of the biggest deals of the year and the issue received orders worth $9.5 billion. Later in December 2013, Bharti Airtel again raised 500 million euros.
Earlier in January, Indian Railway Finance Corporation (IRFC) was the first Indian company to issue an overseas bond issue for $500 million. IRFC overseas bond issue has seen good investor appetite and received subscriptions to the tune of $3 billion.
IRFC?s overseas bond issue had a base size of $500 million with an option to retain oversubscription of $100 million but chose not to retain its oversubscription. IRFC?s bonds attracted a coupon of 3.917% and are listed on the Singapore Stock Exchange. The dollar-denominated issue saw strong demand coming from Europe, followed by Asia and the US. Asset and fund managers bought 76% of the issue followed by banks (14%) and pension funds and insurance companies (6%).
In 2013, Indian overseas bonds hit a record high as companies rushed their issues ahead of anticipated the US Federal Reserve?s tapering of monetary stimulus.
The year 2013 saw 24 overseas issues, of which the Vedanta Resources issue for $1.7 billion in May was the largest, followed by that of Bharti Airtel and State Bank of India (SBI) at $1.2 billion and $1 billion, respectively. The total dollar denominated bonds last year amounted to $11.97 billion, while the number of euro denominated bonds was 750 million and the total Singapore Dollar (SGD) bonds totaled SGD 1.27 billion.
