REC Limited, a Maharatna Central Public Sector Enterprise operating under the Ministry of Power, has achieved a significant milestone by raising USD 1.15 billion in syndicated term loans during August 2023. This financing initiative, aimed at bolstering power, infrastructure, and logistics sector projects, marks a pivotal moment in REC’s commitment to advancing India’s developmental objectives.

Financial Details:

These term loans, structured with a 5-year tenor, are anchored to the Overnight SOFR (Secured Overnight Financing Rate), a key benchmark for USD-denominated loans. The garnered proceeds from this substantial facility will be directed toward projects in compliance with the Reserve Bank of India’s ECB guidelines. This fundraising endeavor aligns with REC’s ambitious Market Borrowing Programme, targeting Rs. 1.20 lakh crore for the fiscal year 2023-24.

Syndicate of Support:

REC Limited sourced this remarkable funding through two distinct tranches, facilitated by a consortium of six banks serving as Mandated Lead Arrangers and Bookrunners (MLABs).

Tranche 1 (USD 505 Million): This portion was successfully raised on August 3, 2023, with contributions from Bank of Baroda, Gujarat International Fin Tec-City (GIFT City) IFSC Banking Unit (IBU), Axis Bank, GIFT City IBU, and State Bank of India, London Branch.

Tranche 2 (USD 645 Million): The second tranche was secured on August 31, 2023, with backing from State Bank of India, London Branch, Bank of India, GIFT City IBU, Bank of India, London Branch, and HSBC, GIFT City IBU.

Historic Achievement:

Notably, these combined tranches witnessed an impressive aggregate commitment of USD 550 Million from GIFT City IFSC Banking Units (IBUs). This exceptional level of commitment signifies a significant achievement for REC Limited, surpassing its previous record of USD 345 Million in December 2021.

Chairman’s Perspective:

Shri Vivek Kumar Dewangan, Chairman and Managing Director of REC Limited, expressed his satisfaction with the successful closure of the USD Term Loans. He stated, “REC has actively pursued innovative strategies to diversify its sources of borrowings, ultimately reducing its cost of borrowings. The successful execution of these two transactions within a single month underscores REC Ltd.’s robust financial standing, maintaining its appeal to international lenders. We are gratified by the enthusiastic response of banks to these loans, marking our most substantial fund-raising effort in a single month from GIFT City IBUs. This accomplishment further reinforces REC’s position as the leading PSU borrower in the international markets for the current year.”

In securing USD 1.15 billion through syndicated term loans, REC Limited reaffirms its pivotal role in financing crucial projects for India’s power, infrastructure, and logistics sectors, contributing to the nation’s economic growth and development.

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