Reliance Jio to upheave $750 million via offshore loan

Reliance Jio is raising around $750 million (about Rs 5,700 crore) through an offshore syndicated loan to primarily fund future capex needs, ET stated.

The likes of Bank of America, Credit Agricole, HSBC, State Bank of India and three Japanese banks —
MUFG, Mizuho and SMBC – are slated to syndicate the five-year offshore loan likely to be priced after
adding 120-130 basis points over the Secured Overnight Financing Rate (SOFR) — a new global rate
gauge, market sources told ET.

Earlier in January, Jio raised about Rs 8,000 crore by selling corporate bonds in local money markets to
primarily clear a portion of past dues relating to spectrum purchases in the 2014 and 2015 auctions, ET
had reported.

Industry insiders say a chunk of the proceeds of Jio’s latest fundraise could be used for capex spends
towards the first wave of 5G network rollouts, particularly in the urban markets. Jio may also use a portion of the loan proceeds to refinance some short-term bridge loans raised earlier through commercial papers, another person with direct knowledge said.

The government has been coaxing the regulator to send its 5G spectrum pricing recommendations by
March-end so that the sale in on during May. The government wants initial 5G rollout by August 15.
Jio is expected to be the strongest participant in the upcoming 5G spectrum sale.

But before that, Jio is also strengthening its 4G network to stave off a stiff challenge in the market from rival, Bharti Airtel, as well as loss-making, Vodafone Idea, which is trying to regain lost ground after a government relief package.