ONGC Videsh Ltd (OVL), the international subsidiary of Oil and Natural Gas Corp. (ONGC), is set to raise $800 million through a five-year loan from three Indian banks. The loan, expected to be priced at 120 basis points above the three-month international benchmark Secured Overnight Financing Rate (SOFR), is aimed at refinancing existing high-cost debt and for general corporate purposes.
Leading The Arrangement
Bank of Baroda (BoB), Axis Bank, and DBS Bank from Singapore are leading the arrangement of this loan. They will also reach out to other banks in Singapore and Taipei to broaden participation in the deal.
The final pricing of the loan may vary depending on the interest from other banks involved. Currently, with the three-month SOFR rate at approximately 5.30%, the loan could be priced around 6.50%.
OVL regularly accesses international funding markets to secure US dollars needed for its global investments and operational needs. Earlier this year, the company raised $420 million in a similar arrangement with DBS Bank and BoB.
Exploring And Developing
ONGC Videsh focuses on exploring and developing oil and gas resources abroad, holding interests in 32 assets across 15 countries. It is India’s second largest petroleum company in terms of reserves and production, following its parent company ONGC.
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