Oil marketing company Bharat Petroleum Corp.Ltd (BPCL) could raise anything between $500 million to $1 billion by selling dollar bonds to investors abroad as early as next week, in the first such exercise by an Indian company in 2017, three people familiar with the deal said. The money will be used to refinance short term loans taken by the company to buy stakes in Tass-Yuryakh and Vankor, two oil fields operated by Russian government owned oil giant Rosneft.
Last year BPCL along with Indian Oil Corp Ltd and Oil India had jointly bought 29.9% stake in Taas-Yuryakh oilfield in East Siberia for $1.12 billion and 23.9% in the Vankor oilfield for $2.02 billion. The three companies had jointly taken a $2 billion short term loan for the same. The bonds will be sold through the company’s Singapore based subsidiary BPRL International Singapore Pte Ltd and will be of a five year tenure. Five banks, namely Citibank NA, Standard Chartered Plc, DBS Ltd, Mitsubishi UFJ Financial Group and SBI Capital Markets are helping BPCL raise the money, these people said.
Bankers will organise investor meets for the bond buyers in Hong Kong, Singapore and London starting on Thursday and continuing early next week these people said. Earlier on Wednesday, Fitch Ratings assigned a 'BBB-(EXP)' to the bonds in line with the $2 billion medium term note program of BPCL. “BPCL will unconditionally and irrevocably guarantee up to 120% of the total aggregate principal amount of the proposed senior unsecured notes. The notes will rank pari passu with other senior unsecured borrowings of BPCL,” Fitch said.