Cube Highways Trust, an infrastructure investment trust (InvIT) has issued AAA-rated non-convertible debentures (NCDs) to raise Rs 11.52 billion. The NCDs were issued for two different tenures, of three and seven years. The proceeds from this transaction are proposed to be used to refinance existing floating rate loans.
With a premium over face value and a subscription of around 2.6 times the offer for refinancing the current rupee loan, the three-year series was raised at a coupon of 7.25 per cent. Five mutual funds and a non-banking financial companies (NBFC) were among the final participants.
Four insurance companies, a pension fund, and an NBFC were among the final participants for the seven-year series, with a premium over face value and a subscription that was roughly double the offer for refinancing an existing rupee loan. The seven-year series was raised at a coupon of 7.3 per cent.
A wide range of investors support the InvIT, including British Columbia Investment Management Corporation, Abu Dhabi’s sovereign investor Mubadala Investment Company, and I Squared Capital, a fully-owned subsidiary of the Abu Dhabi Investment Authority (ADIA). Strong investor participation is expected to diversify the trust’s funding sources while strengthening the relationship with international banks.