IOC raises $300 mn from US to fund expansion

Indian Oil Corporation, the nation's biggest refiner, borrowed $300 million by selling bonds to select investors in the US to partially fund new plants.

The money was raised from 13 investors, the New Delhi-based refiner said in an emailed statement yesterday. The money will be used to fund projects in the year that began on April 1. Bank of America and Citigroup managed the fund-raising.

The oil major borrowed $100 million more from an initial plan to raise $200 million because an overwhelming response was received from investors, the company said.

The state-run refiner plans to increase spending by 61 per cent to Rs 6,000 crore ($1.5 billion) this year on expansion, including increasing capacities of its refineries and construction of a chemical plant, Chairman S Behuria said on May 28.

The refiner plans to spend Rs 2,869 on upgrading and expanding its plant in Haldia in eastern India, Behuria said on May 28.

The bonds were sold at a fixed rate of interest on an unsecured basis with an average maturity of about 10 years, the company said. It didn't give the rate of interest.