REC secures $500 million through 5-year bond sale
“At 4.78% for a five-year bond, this issue was one of the most tightly priced instruments and could open the doors for more Indian companies to access the bond market,” the report stated.
REC Ltd raised $500 million by selling a five-year bond to investors worldwide in a deal that closed on Monday. According to news reports, the bonds were priced 127 basis points higher than the five-year US Treasury, which traded at 3.51% on Monday.
One basis point equals 0.01 percentage point. The 127 basis points spread is indicative of the reward that investors expect while taking the additional risk of investing in REC’s bond compared to the US treasury.
“At 4.78% for a five-year bond, this issue was one of the most tightly priced instruments and could open the doors for more Indian companies to access the bond market,” the report stated.
Read Also : Alstom delivers the first train set for Delhi Metro Phase-IVThe REC bond was priced at 4.78%, compared to 5.62% when the company raised $750 million through a five-year bond sale in April of last year. Reportedly, Bankers who participated in the offering included HSBC, MUFG, and Mizuho Bank.
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