Mumbai, February 23: Cross-border financiers are at it again: bidding for mandates in all earnest. The December-January `leg up, bonus time' is over. Full-blooded efforts have been renewed to get pole-position: that of lead manager's.Up for grabs is the $200-million loan offering by cellular operator BPL-US West, a jumbo $600-million refinance facility for Indian Oil Corporation (IOC), a nearly $250-million plus one for the AV Birla group's Bina Power and Indian Petrochemicals Corporation's $250-300 million Yankee bond.
If early indications are anything to go by, 1998 will see pitched battles between packleaders Bank of America (BankAm), ABN Amro Bank, Union Bank of Switzerland (UBS) and ANZ Investment Bank (ANZIB). Toronto Dominion Bank (TD), Bankers Trust (BT) and new-kid-on-the-block, Nationsbank, are expected to put up a tough fight. Nationsbank has already put through a $200-million up-front credit deal for Essar Steel within a month of going flat out.
One of the hottest transactions in the marketat the moment is a refinance option for IOC. The country's oil-canalising agent's $600-million short-term facility arranged by BankAm and HSBC will mature shortly. Bidders include Nationsbank, State Bank of India and earlier arrangers BankAm and HSBC, among a host of others. IOC is expected to be a big borrower in the international markets this year too after last calendar's over $1.5-billion mop up.
The first big deal of the calendar year has gone to ANZIB. ANZ Grindlays Bank's investment-banking arm will lead manage Spic Electric Power Corporation's $374-million loan. ANZIB had beaten BankAm, ABN Amro Bank and others like Citibank and Deutsche Morgan Grenfell in the race to clinch the deal.
International borrowing by Reliance for its power and telecom ventures is also on the cards. Cross-border arrangers expect at least $400 million under these heads by the company.
One of the more exciting transactions may be put through by the Dabhol Power Company (DPC). Leading investment bankers and financialinstitutions are brainstorming to get going DPC's $4-billion debt for its liquefied-natural gas (LNG) phase-2 linkage. Issues related to the $2-billion Enron International-Qatar government 35:65 joint venture -- Qatar Gas & Pipeline Company -- for a 5-million cubic metre per annum capacity LNG plant; gas carriers to carry LNG to Dabhol costing $700 million; a regassification unit, port and the Dabhol-Hazira pipeline estimated at $800 million and committed offtake agreements for 3 million cubic metre of LNG per annum by fertilizer and power concerns are being worked out now.
International loan offerings by Haldia Petroleum ($300 million), Cogentrix Power (at least $700 million) -- now that the draft of new power-purchase agreement (PPA) is ready -- and Sterling Cellular with a $240-million loan to be lead managed by ANZIB and Credit Lyonnais are on the cards.
In calender 1997, domestic corporates raised $5.185.36 billion in cross-border deals. BankAm and ANZIB emerged as top arrangers with a cumulativemarket share of well over 42 per cent.
This year, the `take' will be both smaller and tougher to get for traditional cross-border arrangers with banks in South Asia almost out of the market. But domestic project-finance loans, say analysts, may still find takers as last year's mobilisers -- Birla-AT&T ($283-million), Reliance Petroleum ($300-million) and Tata-Bell Canada ($75 million) -- have not disappointed investors.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
