Bharti Airtel, India’s premier digital communications provider, has successfully priced its debt fund raise of US$1.25 billion through the issuance of its first ever dual-tranche US$ bond offering spread across senior and perpetual issuance.
This is the largest issuance by any Indian Investment Grade issuer since January 2019, the company said in its release.
Airtel has priced US$750 million of senior 10.25 year bonds at a yield of US 10 Year Treasury + 187.5bps for an implied coupon of 3.250%. Simultaneously, Network i2i Limited, a wholly owned subsidiary of the Company priced US$500 million in guaranteed subordinated perpetual NC 5.25 year bonds with a coupon of 3.975%. This is a lowest every yield on 10 year and Perpetual bonds for Bharti Airtel.
The offering was significantly oversubscribed with very strong demand from several marquee Asian, European and American funds. The peak order book of over US$ 5bn at the time of final price guidance allowed the pricing to tighten significantly from Initial Price Guidance (“IPG”) on both tranches and allowed the Company to meet its pricing as well as size objectives. The senior 10.25 year tranche was launched at IPG of 230bps over 10 year US Treasuries and eventually tightened by 42.5bps to price at 10 year US Treasury + 187.5bps. Similarly, the Perpetual NC 5.25 tightened by 37.5bps from its initial price guidance.
Deal Highlights:
- Orderbook from 92 accounts for the senior 10.25Y issuance and from 97 accounts for the subordinated perpetual bond
- Book very well distributed by region- Over 30% from APAC , over 45% from EMEA with the balance from US accounts
- Over 95% allocation of the senior bonds (and 93% in the case of the Subordinated Perpetual Bond) to asset managers, insurance companies and real money accounts with the balance to private banks, corporate, broker dealers and others
Commenting on the development, Ashish Sardana – Group Treasurer, Bharti Airtel said: “The strong reception of both our senior and perpetual bonds by high quality global investor community reflects its confidence in our business and credit. We remain focused on keeping our balance sheet strong and these issuances further bolster our capital structure. We are delighted by the outcome and thank our investors for their continuing support.”
Barclays, BNP PARIBAS, BofA Securities, Citigroup, HSBC, J.P. Morgan and Standard Chartered Bank acted as Joint Lead Managers and Joint Bookrunners, while DBS Bank Ltd. & SMBC Nikko were the Co-Managers on the trade.
The Legal Advisors to the Company were Linklaters Singapore Pte. Ltd. and the Legal Advisors to the lead managers were Cyril Amarchand Mangaldas & Co and Latham & Watkins LLP. Deloitte Haskins & Sells LLP Chartered Accountants is the Statutory Auditors of the Company.
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