GMR Infra today said it had re-financed $737 million of a short-term loan raised for the InterGen acquisition two years earlier and due for repayment later this year. This amount will now be due for repayment after five years.
The total short-term debt raised on account of the Intergen buy was $837 million (Rs 3,840 crore). Sources say GMR converted $100 million of the debt into equity.
The parent company, GMR Holdings, contributed by infusing equity from its internal accruals.
“An amount of $100 million was prepaid by a combination of dividend payments from Intergen, management fees and internal accruals from the parent company,” said a source. GMR refused to comment.
The rest of the loan, $737 million (Rs 3,380 crore), has been converted into $500 million of primary debt and $237 million of mezzanine debt (lower-priority debt, which includes equity-based options).
A consortium of banks participated in this, led by Axis Bank and ICICI Bank. The others were Bank of India, Bank of Baroda, Canara Bank, Exim Bank, Indian Bank, Indian Overseas Bank, and Syndicate Bank.
More From This Section
Bangalore-based GMR Infra had raised this short-term bridge loan for two years, in October 2008.
This debt was used to fund the $1.1 billion (Rs 5,000 crore) GMR paid for the acquisition of a 50 per cent stake in InterGen, a Dutch power company. The loan was due for re-payment in October this year.
“Despite increasing spreads in the foreign currency markets, the pricing was achieved on competitive terms for a longer tenor of five years,” went a GMR statement.
InterGen is now jointly owned by the Ontario Teachers’ Pension Plan and GMR. InterGen has 12 power plants spread over the UK, the Netherlands, Mexico, Philippines and Australia.
It has a total generation capacity of 8,088 Mw and is planning to expand this by another 4,000 Mw.
“Despite last year’s massacre in global markets, Intergen made positive Ebitda (earnings before interest, taxes, depreciation and amortisation) and cash flows and net cash accrual,” A Subba Rao, Chief Financial Officer of GMR had earlier told Business Standard in an interview.
GMR, which has interests in airports and roads, also has installed (domestic) power generation capacity of 808 Mw under its subsidiary, GMR Energy. It aims to increase this to 6,500 Mw within the next four years.
Two different private equity deals have infused $300 million (Rs 1,375 crore) into GMR Energy, this year. Temasek, the Singapore-based Asian investment company, invested $200 million through a structured paper issue, compulsorily convertible into equity. In addition, IDFC invested $100 million this June.