Oil India Ltd completes $500-mn bond offering
Oil India International Pte Ltd, a singapore based wholly owned subsidiary of Oil India Limited (oil), has successfully completed $500 million Reg S bond offering on April1, 2017. The $ 500 million Reg S senior unsecured 10-year notes are guaranteed by Oil India Limited, which is one of the leading Indian oil & gas 'navratna' CPSE engaged in the exploration, development, production and transportation of crude oil and natural gas. Oil is the second largest public sector exploration and production company with government of India being the majority shareholder with current shareholding of 66.60%.
The bonds are rated 'BAA2' by Moody's and 'BBB-' by Fitch. The $ 500 million bond issue marks second successful foray of Oil India group in $ Reg S markets and represents the lowest spread achieved by any indian issuer for a 10 year usd transaction in last decade. The US$ denominated 10-year bonds were priced at a spread of 172.5 bps over the 10-year US treasury and will bear fixed interest coupon of 4% per annum. The bonds will mature on April 21, 2027. The credit spread of current issuance is 100 bps tighter than oil's maiden us$ 500 million 10 year bonds issued in 2014.
The final allocation had 56% investor participation from Asia and 44% from Europe & US offshore with 63% investment from asset / fund managers, 18% from insurance companies and SWFS, 14% from banks and 5% from private banks Barclays, Citibank and SCB acted as the joint global coordinators for the offering.