“The debt will be funded through a group structure limited by the proceeds from the company’s 12 special purpose vehicles (SPVs). These SPVs have solar power project operating projects with multiple power purchase agreements (PPAs) with central competitors such as SECI (Solar Energy Corporation of India),” a person briefed on the details said. The refinancing is for ACME’s 450 MW of operational solar projects.
The limited group (RG) structure in the loan agreement defines which subsidiaries or SPVs will comply with the covenants and guarantees for the loan. The structure allows the lending company to identify which companies and cash flows will service the loan. If any company fails to meet their share of the payments, the SPVs in the group can step in, thereby facilitating repayment to the lender.
Vedanta Ltd is raising nearly ₹ 3,000 crore through a domestic bond issue early next week to refinance future liabilities and strengthen liquidity. The three-year and five-year non-convertible bonds are expected to offer coupons of around 8.75% and 9%, respectively.
The loan is priced at 8% to 8.50%. The funds will be used to repay dollar bondholders as notes issued by ACME subsidiary India Cleantech Energy mature later this year.
In August 2021, Cleantech had issued $334 million in bonds at a coupon rate of 4.7%. The proceeds were then used by Cleantech to subscribe to non-convertible debentures (NCDs) of Rs. Dollar bonds are currently trading at a yield to maturity of 6.24%.
