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IIFL Finance buys back $50mn overseas bonds

IIFL Finance bought-back $50mn of its 5.9% dollar bonds due 2023. IIFL Finance funded the buyback via an offshore short-term overseas loan facility extended by HSBC. The 5.9% 2023s were issued in February 2020 with IIFL raising $400mn. Post the latest round of buybacks, the amount outstanding stands at $323.7. The buyback was conducted under a modified Dutch auction process. The minimum bid price for bondholders for the tender offer was $970/bond for a face value of $1000. When the buyback was planned in late March, IIFL said it expects to save 200bps in capital costs through the buyback.
The company, which had in the last two years bought back bonds worth $26.3 million in various tranches, launched a tender offer on March 21, 2022 to further buy back up to $50 million worth of bonds.
“The abundant liquidity and the price at which we bought back reflect the confidence that bondholders have in us. Also, this reduces our cost of funds by approximately 225 basis points for the arrangement,” IIFL Finance CFO Rajesh Rajak said.
As on December 2021, IIFL Finance’s free cash and equivalent stood at Rs 9,145 crore, adequate to meet not only its all the near-term liabilities but also to fund the future growth .

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