In the single largest offshore 5-year loan facility arranged by an Indian company during the last three years, ONGC Videsh (OVL), the overseas arm of state-owned Oil and Natural Gas Corporation (ONGC), has entered into separate agreements with two consortiums of international banks to raise $2.5 billion via offshore borrowing. The company would use these funds to finance 10% Mozambique block acquisition.
The first facility for a five year term amounting to $1.77 billion was signed with consortium of reputed international banks, including ANZ, Bank of Nova Scotia, BTMU, DBS, Mizuho, RBS, Societe Generale, SBI and SMBC. The Company had initially planned to raise $1 billion through this long-term facility, however, later decided to upsize the same in view of overwhelming response from the banks. Meanwhile, the second facility is in the nature of a bridge finance of $725 million for a one year term with consortium of reputed international banks including ANZ, BNP Paribas, BTMU, Citi, DBS, RBS and SBI.
In January 2014, the company had raised $1.5 billion 1-year bridge loan facility from a consortium of 9 banks to finance the acquisition of participating interest of 6% in the Rovuma Area I Block in Mozambique offshore from Videocon.
