IL & FS Raises 575 Million Yuans From Chinese Debt Market
IL & FS Raises 575 Million Yuans From Chinese Debt Market
An overseas arm of the leading infra lender and toll road operator infrastructure Leasing & Financial Services (IL&FS) raised 575 million yuans which is around $92 million from the Chinese debt market. The 3 year bonds were floated by ITNL or IL&FS Transportation Networks Pte Ltd, will give a return of about 8 percent to investors. Debt was raised by IL&FS Transportation, which is the holding company of ITNL, merchant bankers for the deal declared.
This has achieved the record of being the first unrated bond sale from a domestic issuer in the Chinese debt market. IL& FS Transportation was established in the year 2000 as the wholly-owned unit for IL&FS. It is the largest build-operate-transfer (BOT) road asset owner in the nation. The company has a 13,100km lane in its portfolio.
The company has also provided initial pricing guidance of 8.37%. However, due to high demand that touched 2.1 billion yuan or 3.8 times the order-book, the pricing has been tightened by 37 basis points at close, according to sources quoted by the media said.
The bonds are not be listed on the Hong Kong Exchange. IL&FS Transportation or ITNL was not available immediately at once for comments. ICICI Bank has sold around 500 million yuan bonds. This is the first issue from an Indian lender.
The Chinese financial market is as of yet untapped by domestic corporates. Indian companies are more likely to look Westwards for selling the debt instruments. Merchant bankers indicated the current issue reopens the the large Chinese debt market for corporates from India.
ITNL is the execution arm of the IL&FS foreign projects and it has an under-construction toll road project in China. This is known as the Chongqing-Yuhe Expressway. It holds a 49% equity consideration. The group also has operations in Spain, Portugal, Ukraine and Latin America.
IL&FS Transportation is the key player in the transport sector with a massive presence in the metro rail space as well the border check-posts and city bus services. Its most recent acquisition has been Elsamex of Spain that is into highway operations as well as maintenance and allied services.
IL&FS is over 25 years old and it is a leading domestic firm in the fields of infrastructure development and financing. The company has the capabilities to obtain projects which last form the concept to the commissioning stage. Established in the year 1987, IL&FS shareholders include Abu Dhabi Investment Authority, Orix Corporation of Japan, Central Bank of India, SBI, HDC and LIC. On July 11, 2014, the IL&FS Transportation Networks closed 4.6% down. The 52 week high of the share was Rs. 230.80 and the low was Rs. 93.20. The latest book value of the company is Rs.107.38 per share. Currently, the price to book value of the company is 1.94.
