Mytrah Energy, the India-based independent power producer (IPP), has raised US$70 million of new debt from Merrill Lynch International, a Bank of America Merrill Lynch (BAML) entity, and funds managed by affiliates of Apollo Global Management, LLC.
The new finance takes the form of an INR3,977 million (US$65 million) India-listed non-convertible bond issued by Mytrah Energy Ltd., and a US$5 million loan to Mytrah Energy Ltd.
The bond is a long-term 5-year instrument with a cash coupon of 12% per year. The proceeds from this issue will be used primarily to refinance an existing INR900 million (US$15 million) mezzanine facility provided by IDFC and for development of new wind power projects from the company's extensive pipeline.
The company has additionally issued warrants giving BAML and funds managed by Apollo the option to purchase a total of 8,612,412 shares in Mytrah Energy Ltd. at a strike price of £0.7729 (US$1.2) per ordinary share. These warrants represent 5% of the company's issued share capital post exercise, and can be exercised at any time during the 5-yearr lifetime of the bond.
The financing also contains a "greenshoe" option to extend the bond by a further INR1,583 million (US$26 million) and the loan by US$2 million, which would bring the total to approx. US$98 million. No additional warrants will be issued if the company elects to pursue this option.
Ravi Kailas, Chairman and CEO, Mytrah Energy Ltd. said:
"At Mytrah, we have built an operating portfolio of 524.85MW since inception only 4 years ago. This asset base is performing very well, and, despite relatively low winds in the first half of 2014, I am pleased to say that the overall monsoon season has been in line with those we have experienced previously."
"The confidence shown in us by Bank of America Merrill Lynch and Apollo is powerful validation of our business model and, with a long pipeline of wind projects in place, we are delighted to have secured the support of investors with whom we can build a long standing and fruitful relationship."