Muthoot Finance Ltd Raises USD 450 Million from International Bond Markets

KOCHI:
Muthoot Finance Ltd (“MFIN” or “Company”), the largest gold loan company in India, has successfully priced a USD 450 Million Fixed Rate Senior Secured issuance in 144A / Reg S format for a 3 year tenor at 6.125%.

MFIN bond transaction marks the first international bond by a NBFC to debut in 144A / Reg S market, allowing it to tap the US investor base in addition to Asia and Europe. The proceeds will be used for permitted purposes including onward lending in accordance with RBI’s ECB Guidelines and other applicable laws.

The Company engaged with investors during an extensive deal roadshow across Singapore, Hong Kong, London and US. Backed by strong investor feedback, the transaction was launched with an initial price guidance of 6.375% area. Following a strong order book momentum supported by high quality real money investors, the Company was able to tighten pricing by 25bps to 6.125%.

The final order book was in excess of USD 1.2 Billion with oversubscription of more than 2.5x. The transaction witnessed 37% participation from Asia, 28% from Europe & Middle East and 35% from US with 88% investments from asset managers, 6% from Insurance & Pension Funds and 6% from others.

The bonds will be listed on International Securities Market of the London Stock Exchange. Earlier this month, Company had obtained issuer rating Long Term rating of ‘BB+’ with ‘Stable’ Outlook by Fitch Ratings, ‘BB’ with ‘Stable’ Outlook by S&P Global Ratings and ‘Ba2’ Corporate Family Rating with ‘Stable’ Outlook by Moody’s Investor Service. Deutsche Bank and Standard Chartered Bank acted as the Joint Global Coordinators and Joint Book Runners for the issue.

M.G.George Muthoot, Chairman , on this inaugural issue stated “The response from international bond investors to our debut international bond issue once again reiterates the robustness and long track record of our gold loan business and is a recognition of India’s retail credit story. This fund raise will enable us in further diversifying and strengthening our sources of funding. We look forward to strengthening our partnership with global investors”