denotes premium content | Jan 6 2009 
Feature
posted 23 Feb 2005 in Volume 8 Issue 4
Reliance Infocomm, India: Reaching record heights in India
Sole lead arranger: Citigroup
Borrower: Reliance Infocomm, India
Deal size: $750m
Lenders: US Ex-Im (with Citibank as alternate lender) and Export Development Canada
Purpose: roll-out of pan-India mobile network
Closing: 22 December 2004
As the largest official agency financing in India, this $750m buyers credit allowed Indian telecom company, Reliance Infocom, to overcome single-borrower-limitation constraints faced by most of its relationship banks in India. Board approval was received within six months of application.
“This is a landmark transaction for Ex-Im, EDC, Reliance, Citigroup and India in general. And it is the largest ECA financing in India that we know of,” says Carlos Lopez, export and agency finance, Citigroup global markets.
Furthermore, even though the company had been in operation just 18 months, the agencies agreed to provide a structured corporate finance treatment rather than a full project finance or shareholder-supported financing.
“This is a key innovation,” says Valentino Gallo, managing director, export and agency finance, Citigroup. “In most other markets a deal like this would have been structured as a full project finance deal.”
In addition, terms and conditions were customised to address the dynamic credit-risk characteristic of a large, fast-growing telecom company. Reliance will use the funds to roll out a pan-India CDMA mobile network.
Reliance Infocomm is part of Reliance Group, India’s largest business house. The group includes: Reliance Industries, Reliance Capital, Reliance Industrial Infrastructure, Reliance Telecom, Reliance General Insurance Company, Indian Petrochemicals Corporation and Reliance Energy.
