RIL raises $ 2 Billion, 13 year loan backed by Euler Hermes

Business

oi-Sneha

By Sneha B K

Published: Thursday, May 10, 2012, 10:44 [IST]

Reliance Industries Limited (“RIL”) has signed a USD $ 2 billion equivalent loan with nine banks covered by Euler Hermes Deutschland AG earlier this week in Germany.

The loan will be primarily used to finance goods and services procured from German suppliers as part of RIL's petrochemicals expansion projects at Jamnagar, Hazira, Silvassa and Dahej in India.

This facility is significant on various counts, said the company. "The facility is among the largest underwriting by Euler Hermes in recent years; Euler Hermes has for the first time accorded 'Better than Sovereign' rating to a corporate. Despite the challenging financial markets, the deal witnessed ~ 50% over subscription.The facility has a door-to-door maturity of 13 years," said the company.

This deal helps diversify RIL's funding sources and extends the maturity profile of its long term debt in a cost effective manner.

V. Srikanth, joint chief financial officer, RIL, said, "We are delighted with the support provided by Euler Hermes for this landmark financing. This deal received strong support from international banks, particularly from German lending institutions. The better than sovereign assessment by Euler Hermes is a strong testimony of RIL's credit standing in the international markets."

The shares of the company on Thursday were seen trading higher by 1.06% at Rs 702.50 at 10.45 am ISt on BSE.

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