Refinancing to reduce debt cost to 6.8% from 9.4%

Refinancing to reduce debt cost to 6.8% from 9.4%

Embassy Office Parks REIT (Embassy REIT) on Monday said it has raised a fresh debt of ₹4,600 crore at 6.5% interest.

The proceeds from this debt raise would be utilised by Embassy REIT to repay its existing zero-coupon bond outstanding of ₹4,530 crore.

Aravind Maiya, Chief Financial Officer of Embassy REIT, said, “With this refinancing, our consolidated debt cost reduces to 6.8% from the original 9.4% at the time of listing, thereby significantly reducing our interest cost to the benefit of our unitholders. Also, we have been able to diversify our debt investor base by tapping into newer avenues of capital such as insurers, thereby underscoring the growing investor confidence in our business.”

According to the company, the Debenture Committee approved the allotment of ₹3,100 crore Series V rupee-denominated, listed, rated, secured, redeemable, transferable NCDs ( Non-Convertible Debentures) by way of private placement at 6.5% average fixed coupon. The NCDs will be listed on the Wholesale Debt Market of BSE Limited.

Embassy REIT has also secured a term loan facility at SPV-level from a bank for ₹1,500 crore at 6.4% floating coupon. Both these proceeds, totaling ₹4,600 crores, would be utilised to redeem the Series I NCDs on November 2, 2021, the company further said.

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