Tata Communications, an arm of the Tata Group, today launched a benchmark (SGD 500 million or more; about Rs 2,200 crore) issue in the Singapore market, providing a further boost to domestic corporates raising funds overseas, according to merchant banking sources.

“The benchmark issue from Tata Communications Netherlands, a subsidiary of Tata Communications, denominated in Singapore dollars, has an initial pricing guidance of 4.250-4.375 per cent. The bond sale has a maturity of three years,” a merchant banking source told PTI.

Tata Communications could not be immediately reached for comments.

The REG S (Regulation S) bond issue carries a guarantee from parent Tata Communications, which is into international voice and data transfer. Regulation S bonds are a “safe harbor” as they are executed in another country and will not be subject to the registration requirement. These bonds carry two safe harbour provisions——an issuer safe harbour and a resale safe harbour.

On January 7, the Exim Bank raised $750 million in a European bond sale at the cheaper ever rate of 4 per cent for a 10-year money, which got an over-subscription of 8.5 times the issue size.

Within a week, state-run distribution utility PowerGird raised $500 million at 3.87 per cent for a 10-year dollar issue which got an over-subscription of 19 times.

In the same week, the largest private lender ICICI Bank mopped up $225 million from a seven-year Singapore bond sale programme on January 10.

Tata Communications was formerly the state—run VSNL, which the Tatas bought through a divestment programme in early 2000.

(This article was published on January 24, 2013)
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