Essar prepays Rs 4,230 cr raised via NCDs

PTI New Delhi | Updated on March 21, 2011 Published on March 21, 2011

The Essar Group today said it has pre-paid Rs 4,230 crore raised by subsidiary Essar Communications Holdings Ltd a year ago, a move that will give the Ruias a free hand to decide on the option for part-sale of their stake in joint venture Vodafone-Essar.

“Upon settlement of these bonds, the 10.97 per cent equity stake in Vodafone Essar Ltd held by ECHL will be free from all encumbrances,” Essar said in a statement.

It has exercised the issuer call option of the Rs 4,230 crore rated, listed, zero coupon non-convertible debentures.

The bonds were raised in January, 2010, in two series of Rs 2,115 crore each, with maturity dates of July 22, 2011, and December 7, 2011, it said.

“Now, Essar has decided to foreclose both the bond series with settlement date of March 29 and has deposited the entire outstanding amount in escrow with the account bank for onward payment to bond holders on March 29, 2011,” the company said.

Essar has a put option with Vodafone, under which it has the option to sell its 33 per cent stake in Vodafone Essar for $5 billion, or part sale at a fair market value. Essar holds 11 per cent in Vodafone through domestic entity ECHL and the balance 22 per cent through overseas entities.

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Published on March 21, 2011
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