ONGC Videsh to raise USD 800 million from 3 banks
ONGC Videsh Ltd (OVL), the overseas arm of state-run explorer Oil and Natural Gas Corp. (ONGC), is raising $800 million through a five-year loan from three domestic banks, people familiar with the matter said.
The loan is likely to be priced at 120 basis points above the three-month international benchmark Secured Overnight Financing Rate (SOFR), the people said.
«Three banks, state-owned Bank of Baroda (BoB), private sector Axis Bank and Singapore-based DBS Bank are the mandated lead arrangers for this loan which is now being syndicated to other banks. Bankers will go on a roadshow to Singapore and Taipei later this month to broaden the scope of lenders in this deal,» said one of the persons cited above.
The pricing of the loan could change depending on the level of interest from other participating banks, a second person said. At 120 basis points above the three-month SOFR rate, which is currently trading at about 5.30%, the loan could be priced at about 6.50%. One basis point is 0.01 percentage point.
OVL will use the loan proceeds to refinance high-cost debt and for general corporate purposes.
BoB, Axis Bank, DBS Bank and OVL didn't respond to ET's queries.
OVL is a regular participant in the overseas funding market since it requires access to US dollars, the world's primary reserve currency, to sustain its investments and operations. This January, the company raised $420 million DBS Bank and BoB, ET had reported.
OVL's main business is prospecting for fossil fuel sources overseas, including exploration,
