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Essar Power raises INR 750 crore in Rupee bond
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Thursday, 18 Jul 2013
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Essar Power Ltd amongst India’s leading private sector power producers and a subsidiary of London listed Essar Energy said that it has completed an 11 year, INR 750 crore (USD 125 million) denominated bond offering.

This is the second of a number of Rupee bonds to be offered by Essar Power, which when completed will total INR 5,000 crore (USD 850 million). The proceeds will be used to make repayments on existing loan facilities within the power business, particularly relating to its new coal-fired power projects.

Essar Power was assigned a credit rating of A+ by ratings agency Credit Analysis and Research Ltd (CARE), of Mumbai, in October 2012 in respect of the proposed INR 5,000 crore bond issue.

The new bonds issued will be listed on the Bombay Stock Exchange and will be repaid from 2022 to 2024. However, it is currently intended that this bond issue will be refinanced with a INR 3,000 crore (USD 500 million) credit enhanced Rupee bond issue in due course.

During FY 2013 Essar Power completed a number of coal-fired power projects and now has 3,910 megawatts of operational capacity. Work is progressing on further projects intended to take Essar Power’s operational portfolio to 6,700 MW.

Mr Deepak Maheshwari CFO of Essar Energy said that “This bond issue will allow our power business to benefit from longer debt maturity timeframes and lower interest rates compared to our existing debt facilities. Essar Energy is well positioned to capitalise on the growing demand for power in India.”

Source - Strategic Research Institute

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