 "ONGC Videsh plans to raise $700 million from overseas investors")
ONGC Videsh (OVL) is planning to raise $700 million from overseas investors as syndicated loans in its efforts to take advantage of the falling interest rates in the international markets and retire its old loans.
The company has requested banks to send in their proposals for participating in the offer, which includes a $200-million greenshoe option. OVL expects several banks to join the offering — considering the investor demand for its previous offers. The syndicated loan is expected to be priced at around 100 basis points over the Libor rate, said a banker close to the transaction.
“There is good demand for well-rated companies from India and OVL is taking advantage of the rates, which are down significantly since January,” said a banker. The company had raised a similar sized loan in March, the banker said.
OVL, is the investment arm of India’s oil and gas major ONGC, and has invested in several fields across the world. OVL has been looking to rationalise its existing debt.
According to credit rating agency ICRA: “Over the years, OVL has been acquiring participating interests in overseas oil and gas assets and participates either directly or through wholly-owned subsidiaries/joint venture companies in 37 projects in 17 countries, of which 14 are producing properties.”
The company has requested banks to send in their proposals for participating in the offer, which includes a $200-million greenshoe option. OVL expects several banks to join the offering — considering the investor demand for its previous offers. The syndicated loan is expected to be priced at around 100 basis points over the Libor rate, said a banker close to the transaction.
“There is good demand for well-rated companies from India and OVL is taking advantage of the rates, which are down significantly since January,” said a banker. The company had raised a similar sized loan in March, the banker said.
OVL, is the investment arm of India’s oil and gas major ONGC, and has invested in several fields across the world. OVL has been looking to rationalise its existing debt.
According to credit rating agency ICRA: “Over the years, OVL has been acquiring participating interests in overseas oil and gas assets and participates either directly or through wholly-owned subsidiaries/joint venture companies in 37 projects in 17 countries, of which 14 are producing properties.”
“However, the top three investments (Mozambique, Russia, and Brazil) drove the bulk of investments. OVL’s total oil and oil equivalent gas production stood at 14.98 million tonnes of oil equivalent (MMTOE) in financial year 2019-20 against 14.83 MMTOE in FY21,” ICRA added.
OVL’s revenue during the first quarter of financial year 2021-22 (Q1FY22) stood at Rs 4,075 crore, up from Rs 2,396 crore in the corresponding quarter last year. Profit after tax stood at Rs 915 crore in Q1, up from a loss of Rs 334 crore the previous year. Operating costs rose to Rs 1,473 crore in Q1, up from Rs 1,116 crore the previous year.
(With inputs from Twesh Mishra)
OVL’s revenue during the first quarter of financial year 2021-22 (Q1FY22) stood at Rs 4,075 crore, up from Rs 2,396 crore in the corresponding quarter last year. Profit after tax stood at Rs 915 crore in Q1, up from a loss of Rs 334 crore the previous year. Operating costs rose to Rs 1,473 crore in Q1, up from Rs 1,116 crore the previous year.
(With inputs from Twesh Mishra)
One subscription. Two world-class reads.
Already subscribed? Log in
Subscribe to read the full story →*Subscribe to Business Standard digital and get complimentary access to The New York Times
Smart Quarterly
₹900
3 Months
₹300/Month
SAVE 25%
Smart Essential
₹2,700
1 Year
₹225/Month
SAVE 46%
*Complimentary New York Times access for the 2nd year will be given after 12 months
Super Saver
₹3,900
2 Years
₹162/Month
Subscribe
Renews automatically, cancel anytime
Here’s what’s included in our digital subscription plans
Exclusive premium stories online
Over 30 premium stories daily, handpicked by our editors
Complimentary Access to The New York Times
News, Games, Cooking, Audio, Wirecutter & The Athletic
Business Standard Epaper
Digital replica of our daily newspaper — with options to read, save, and share
Curated Newsletters
Insights on markets, finance, politics, tech, and more delivered to your inbox
Market Analysis & Investment Insights
In-depth market analysis & insights with access to The Smart Investor
Archives
Repository of articles and publications dating back to 1997
Ad-free Reading
Uninterrupted reading experience with no advertisements
Seamless Access Across All Devices
Access Business Standard across devices — mobile, tablet, or PC, via web or app
SAVE 25%