Power News We love to talk!
State-owned Power Grid Corp of India has decided to scrap its Rs.3,46,800 crore bond offering with a tenor of up to 15 years after having raised the money on Wednesday, according to three sources aware of the development.
According to sources, Power Grid took the decision to cancel the sale after peer NHPC raised funds a day later from a similarly structured deal at a coupon that was 3bp lower.
Power Grid’s offering pays a coupon of 8.53%, whereas NHPC is paying a 8.50% annual coupon. Both of the issuers are locally rated Triple A credits.
DCM bankers said they have not seen a precedent in recent times of an issuer cancelling an offering days after pricing it. The bonds were to be settled on Monday.
“It happens only in India and that too with state-owned issuers,” said a DCM banker on the deal. “We are trying to pacify the investors,” he added.
The company has communicated its decision to arrangers by phone, sources said. Bids for the Power Grid’s offering were called on Wednesday, a day on which Asian credit markets plunged, and drew 20 arrangers with submissions in the 8.49-8.60% range.
Of the 20 arrangers, 17 took part in the final sale with SBI Caps taking the biggest amount of Rs.1,12,200 billion rupees. The bonds of both companies will be repaid in 12 annual equal instalments from the fourth year after issuance.
- HC seeks State's view on ESMA for LPG services Read more
- Entire North-East will benefit from OTPC power project Read more
- NHPC issues Rs 2,250 crore bonds following 28 per cent rise in Q2 net profits Read more
- Ushering In An Age Of Smart Transport: An Overview Of Electric Vehicles And Why They Are Crucial For India Read more
- ONGC-Mittal Energy Ltd gives up oil blockin Nigeria Read more
- Vedanta first-quarter consolidated profit doubles Read more
- Power projects may get their very own Aadhaar identity Read more
- Kinetic announces a joint venture to enter the solar energy market Read more
- REC to raise up to Rs 37,000 cr in FY14 Read more
- CPM politburo member Prakash Karat urges people to oppose nuclear power plant Read more