Mumbai, Jan 24 (PTI) Tata Communications today became the first domestic un-rated corporate to tap overseas financial markets by selling bonds worth 250 million Singapore dollars at a coupon of 4.25 per cent, getting over-subscription of 14 times the offer. "The Tata Communications issue, priced at a coupon of 4.25 per cent, is a path-breaking one on many counts as it is the first international bond issuance by an unrated domestic company to date," StanChart India Managing Director for Capital Markets Jujhar Singh told PTI from Chennai. "The huge over-subscription -- to the tune of SGD 3.5 billion -- shows the investor confidence in the credit worthiness of the company in particular and the Tata Group in general," he added. StanChart, RBS, ANZ and DBS were the joint book runners. Singh further said the issue from Tata Communications Netherlands, denominated in Singapore dollars, had an initial pricing guidance of 4.250-4.375 per cent. But due to the huge demand, the final pricing was fixed at the lower end. The bond sale has a maturity of three years. The issue belongs to the REG S bond category and carries a guarantee from parent Tata Communications, which is into international voice and data services. That as many as 63 per cent of the books were lapped up by institutions - banks, fund managers and corporates - shows the trust and confidence international investors have in good Indian papers, Singh said, adding the remaining 37 per cent of the issue were sold to HNIs. On the geographic spread of the investors, he said as much as 88 per cent were from Singapore, 10 per cent from rest of Asia and 2 per cent were Europeans. He said the company would use the proceeds for general corporate purposes. Tata Comm did not offer comments on issue. Singh said the pricing is very commendable and the management could not have timed it better. "This issue should give confidence to other companies to tap the international markets." For Tata Comm, the issue represents diversification of funding source from banks to international financial markets. The new year has seen many domestic companies and financial institutions raising debt. Earlier this month, Exim Bank raised USD 750 million in a European bond sale. Within a week, state-run distribution utility PowerGird raised USD 500 million at 3.87 per cent for a 10-year issue which got an over-subscription of 19 times. In the same week, the largest private lender ICICI Bank mopped USD 225 million from a seven-year Singapore bond sale programme on January 10. PTI BEN KRK SA BAS
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