Ballarpur International Graphic Paper Holdings (BIGPH), a step-down subsidiary of Ballarpur Industries Ltd, has raised $200 million through dollar-denominated perpetual bonds.

The company has priced the bonds 875 basis points above the five-year US Treasury note.

The yield on the bond would be 9.75 per cent. HSBC Bank and Royal Bank of Scotland were the arrangers for the issue.

This is BIGPH's debut transaction in the international bond markets.

Prior to the launch of the transaction, BIGPH conducted roadshows in Singapore, Hong Kong, London, Zurich and Geneva and met key fixed-income investors.

A company statement said the transaction was met with a strong demand from private banks across Asia and Europe, with order books growing in excess of $300 million by London open.

Investor confidence

The quality of the oversubscribed order book (substantially led by real money demand) allowed BIGPH to price at the guidance of 9.75 per cent for the desired deal target size of $200 million.

Mr B. Hariharan, Group Director- Finance, Avantha, said, “Despite an extremely challenging market backdrop, strong investor confidence that allowed us to price the transaction intraday at our desired size and price level. This is truly a first of its kind instrument by any Indian corporate group, and Ballarpur is pleased to have undertaken this path-breaking transaction.

“The instrument has been structured to meet the strategic needs of our company and the investor response confirms their confidence in our strategic business plan”

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