Real Estate

Embassy REIT raises ₹2,600 crore debentures at 6.40% quarterly coupon

Our Bureau Bengaluru | Updated on January 15, 2021 Published on January 15, 2021

Debt-raise part of financing strategy for acquisition of Embassy TechVillage

Embassy Office Parks REIT (Embassy REIT), on Friday, announced that it has successfully priced and allotted by way of a private placement, ₹2,600 crore or $351 million of rupee-denominated, listed, rated, secured, redeemable, transferable, non-convertible debentures (NCDs) at a 6.40 per cent quarterly coupon. The NCDs will be listed on the Wholesale Debt Market of BSE Limited.

Mike Holland, Chief Executive Officer of Embassy REIT, said, “The strength of our balance sheet and the underlying covenants of our 200 plus occupiers are key advantages for Embassy REIT. The attractive rate at which we have raised this bond and our execution timelines have, once again, demonstrated market confidence in high-quality borrowers like Embassy REIT. We will use the funds raised to refinance a portion of the in-place Embassy TechVillage debt. Post this bond raise, we continue to maintain conservative leverage ratios and retain our flexibility to finance future growth.”

Also read: Embassy REIT raises Rs 3,680 cr to part fund IT park acquisition

Morgan Stanley, JP Morgan and Kotak Mahindra Bank served as arrangers and advisors to the private placement, and Cyril Amarchand Mangaldas served as the legal counsel to the transaction.

On January 12, the Debenture Committee of the Board of Directors of the Manager to Embassy REIT approved an issue of NCDs for a principal aggregate amount of up to ₹2,600 crore to be utilised towards refinancing existing Embassy TechVillage debt and for general corporate purposes.

Also read: Embassy REIT’s latest acquisition will be earnings accretive

Earlier today, the Debenture Committee approved the allotment of these NCDs at a 6.40 per cent quarterly coupon. On December 24, 2020, Embassy REIT announced the successful completion of the Embassy TechVillage acquisition for ₹9,780 crore ($1.3 billion) with a ₹3,680 crore ($501 million) equity raise through an institutional placement. The current debt raise is part of the financing strategy for the above acquisition.

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Published on January 15, 2021
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