J Sagar Associates (JSA) and Trilegal have completed mobile phone operator Aircel's Rs 2,000 crore ($449m) commercial paper fundraising to part-finance the telecom operator's upcoming 3G licence auction.

JSA Delhi partners Divyanshu Pandey and Sidharrth Shankar advised Aircel on the loan, assisted by associate Parmeet Walia.

JSA's Shankar said that the firm had worked with Aircel on various technology financings in the past.

Trilegal Mumbai partner Srinivas Partha, who joined the firm from best friend Allen & Overy last August, advised the arrangers Deutsche Bank and placement agent Axis Bank together with a team of Trilegal associates.

It is understood that Aircel's commercial papers have been allotted and all investors have agreed to subscribe, although they have not yet been issued.

Commercial papers are rated and tradable loan instruments with a maximum duration of one year, which can have the advantage of several regulatory and cost benefits compared to other longer-term loans.

Shankar commented: "Commercial paper will be cheaper than bank loans once the base rate system comes into effect. The introduction of the so-called base rate according to which no bank can lend below the base rate from July should give a leg-up to the commercial paper market in India as corporations will prefer them to bank loans for short-term funding needs.

"The guidelines on base rate have been issued by RBI [the Reserve Bank of India] and will become effective from July 1, 2010."