Tata-Bell ECB sails through amid market turbulence
Raghu Mohan
MUMBAI, January 13: Tata-Bell Canada cellular venture's nine-year $70-million foreign-currency loan has been priced at 187.5 basis points (bp) over Libor. Lead managers Bank of America (BankAm) and Toronto Dominion Bank have sucessfully placed the loan."Response to the loan was positive even in a turbulent market," said sources close to the transaction. Names of participant banks and their individual commitments are awaited. The nine-year facility was arranged by BankAm's structured-finance arm based in HongKong -- BA Asia -- and Toronto Dominion Bank. Credit Suisse First Boston (HongKong) was the financial advisor. The loan is a fully underwitten and non-recourse one. BankAm and Toronto Dominion had jointly underwritten the foreign currency and rupee portion. The total underwritten debt of Tata-Bell Canada is about $112 million. Industrial Development Bank of India (IDBI), that took the entire rupee portion of Rs 160 crore, was the country's first financial institution to take on comprehensive
exposure in a cellular venture. Tata-Bell Canada, a 51:49 joint venture between Tata's and Bell Canada, has mandate for the Andhra circle. Tata Communications Ltd is the cellular operator, while Tata Tele Services Ltd is the basic-services operator.Roadshows for syndication of the loan offering opened on December 19 last year in a turbulent market. They were held in Hong Kong and London and co-ordinated out of Singapore. The pricing of 187.5 bp over Libor compares with the 200 bp over Libor for the $283-million Birla-At&T loan, also arranged by BankAm and Toronto Dominion Bank. "There is not much of a difference in the pricing of the Tata-Bell Canada loan compared to the Birla-AT&T loan despite the former being a smaller loan. The international markets have changed and project loans have turned costlier by atleast 60-80 basis points over Libor today," cross-border finance sources said. The Tatas had recently secured finances for their basic services -- Tata Tele Services. International project
loans never had it so good Project loans in India never had it so good. The $283-million nine-year Birla-AT&T foreign-currency loan has been named the "Telecom finance deal of the year for the Asia-Pacific region" by Project Finance International. The $283-million Birla-AT&T loan priced at 200 basis points over Libor was a non-recourse one. The loan was lead-managed by BankAm and Toronto Dominion Bank. The Union Bank of Switzerland (UBS) played the role offinancial advisor to the Birla-AT&T loan. Initially, a slow-moving deal, the loan closed with a small oversubscription. The Birla-AT&T transaction was the first cellular venture in the country to tap the international project loan market.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
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