The Debenture Committee approved the allotment of Rs 3,100 crore Series V denominated in rupees, quoted, rated, guaranteed, redeemable and transferable by private placement at an average fixed coupon of 6.5% payable quarterly. Of this total, Rs 1,100 crore is 7% for five-year NTMs and Rs 2,000 crore is 6.3% for three-year NTMs.
In addition, Embassy REIT secured an SPV-level term loan facility from a bank for Rs 1,500 crore at a floating coupon of 6.4%.
These two products, totaling Rs 4,600 crore, will be used for the early refinancing of Zero Coupon Bonds (NCDs Series I) which carried an average coupon of 9.4% on November 2, 2021. Embassy REIT will be able to guarantee about 300 basis points of interest. annual savings through this refinancing.
After this refinancing, Embassy REIT’s pro forma debt would be Rs 11,532 crore at an interest rate of 6.8% with a maturity of 3.7 years.
“With this refinancing, the cost of our consolidated debt is reduced to 6.8% from the original 9.4% at the time of listing, thereby significantly reducing our interest costs for the benefit of our unitholders. . Additionally, we have been able to diversify our debt investor base by tapping into new sources of capital such as insurers, underscoring the growing investor confidence in our business, ”said Aravind Maiya, Chief Financial Officer of ‘Embassy REIT.
The CRISIL rating agency has assigned a CRISIL AAA / Stable rating to the NCDs issued.
Morgan Stanley, HSBC and Kotak Mahindra Bank were the arrangers of the private placement and Talwar Thakore and Associates acted as legal counsel on the transaction.