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AZB on innovative HDFC issuance as complex debt structures on horizon

India's largest mortgage lender Housing Development and Finance Corporation (HDFC) has issued India's first ever dual warrants and bonds instrument, which was structured by AZB & Partners, Amarchand Mangaldas and Linklaters Singapore to raise Rs 4000 crore ($822m) for the company.

AZB Mumbai partner Shameek Chaudhuri acted for HDFC, assisted by associates Varoon Chandra and Shameek Ray.

Chaudhuri said: "This is the first, which is a warrant-cum-NCD [non-convertible debentures] offering."

He added that since around May many companies had been issuing instruments to qualified institutional buyers (QIBs) through qualified institutional placements (QIPs) of equity shares.

However, HDFC's issue was a non-convertible debt instrument as part of the same offering as a warrant, both of which are already rare in India individually.

He added that he expected even more innovative and complex bond structures to be launched later this year.

Amarchand and Linklaters jointly advised the lead managers as local and international counsel respectively.

Amarchand's team was led by Mumbai managing partner Cyril Shroff with Linklaters Allen & Gledhill partner Dean Lockhart leading from Singapore assisted by managing associate Bhakta Patnaik.

HDFC's issue was the first combined warrant and NCD issue to take place under Chapter XIII-A of the SEBI (Disclosure and Investor Protection) Guidelines, 2000.

The company is expected to raise around Rs 4000 crore ($822m), which it claims is the largest fund raising by any Indian company.

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