Published By : 16 Jun 2017 | Published By : QYRESEARCH
Mphasis, the Bangalore-based information technology firm, has recently raised US$500 mn by trading dollar bonds to repay the loans it took from the private equity giant, Blackstone, which is also a major stakeholder in the IT firm. A Blackstone-owned holding enterprise, Marble Pte, has issued these securities, which are expected to be listed on the Singapore Exchange Limited (SGX). With five-year maturity, bonds are anticipated to gain 5.30%, almost 0.5% point lower than their initial expectation.
The bond-sale has received an oversubscription of nearly US$2.5 bn amidst a soaring demand from global investors, making the way for price tightening, said one dealer. From the second year, the issuance will have a call option, which will allow the borrower to put the liability to an end well before its scheduled maturity; however, not without the interest repayment. The Bond proceeds will be utilized to prefund the interest for the first six months, refinance existing acquisition loans, and for a dividend recap.
Biggest Out-of-India Bond Transaction Backed by PE-Sponsor
Along with Citibank, JP Morgan, and HSBC, Standard Chartered Bank and Deutsche Bank, have aided Mphasis to mop up funds from a number of overseas investors. Financing head at Deutsche Bank, India, Amrish Baliga, said that “this deal symbolize the biggest out-of-India bond transaction backed by PE-sponsor and its success reflects the rise in the global appetite for quality Indian paper with appropriate equity backing.”
From HP Enterprise, Blackstone purchased more than 50% stake in Mphasis the previous year, paying over US$1 bn and making it one of the biggest deal for this US firm in India.