JSW Steel, India's leading steel #manufacturer, has achieved a significant #milestone by securing a $900 million loan from a consortium of eight foreign banks. This strategic #initiative is geared towards refinancing maturing debt and strategically pre-paying high-cost borrowings. By proactively optimizing its financial structure, JSW Steel aims to fortify its capital base, ensuring robust availability for future #expansion endeavors.
The interest rate for JSW Steel on the loan, which is priced 180 basis points above the international secured overnight financing rate (SOFR), which is currently at roughly 5.35%, is roughly 7.15%. This attractive rate highlights the company's skillful handling of current market conditions, demonstrating its sound financial management and effectiveness in obtaining favorable terms in the face of shifting #economic environments. Reputable banks like DBS Bank, BNP Paribas, HSBC, and Standard Chartered are among those who have joined the consortium, demonstrating the confidence that international financial institutions have in JSW Steel's creditworthiness and future #growth prospects.
With $500 million in bonds due in April 2019 and an interest rate of 5.95%, among other immediate payback responsibilities, JSW Steel carefully uses the recently obtained loan to meet these obligations. The excess money will be wisely used to support capital expenditure and pay off additional foreign currency loans. Furthermore, JSW Steel is proactively engaging with international markets through the consortium's planned roadshows in major financial centers such as #Singapore and #Dubai, to syndicate the loan and draw in additional lenders. This strategy plan demonstrates JSW Steel's dedication to affordable financing options and steady expansion in the dynamic steel sector.
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Nikhil Patil | Shreyansh Srivastava | Chakshu Kumawat
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Collection Officer at Mashreq bank (MGN)
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