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Luthra assists banks, Reliance goes it alone to raise $3.1bn

Luthra & Luthra advised a consortium of banks on their Rs 14,550 crore ($3.1bn) project financing of the Sasan Ultra Mega Power Project for Reliance Power.

Reliance handled the transaction entirely with its in-house legal team of seven, led by its head of legal Umesh Mooteri.

Luthra & Luthra Delhi project finance head Sameen Vyas and Mumbai banking head Vijaya Rao (pictured) co-led the team for State Bank of India and a consortium of 11 other lenders.

Rao said: "We got the deal though the lead bank – State Bank of India - who had appointed us as lender's legal counsel."

"It went through at a very fast pace," she added and said the transaction was complex and experienced many changes, since having first been announced in December 2008 and completing in May of this year.

Initially, Reliance was seeking non-rupee loans from overseas banks but as liquidity continued to decrease abroad, the documentation was amended for the majority of the loan to be made in rupees instead.

However, there remains the option for Reliance to convert the loan into foreign currencies at a later stage.

The deal is debt heavy, with Reliance only contributing a quarter of capital. The loan has a maturity of 15 to 20 years and an interest rate of between 12 to 12.5 per cent.

Next to lead arranger State Bank of India, the consortium of lenders included Power Finance Corporation, Rural Electrification Corporation, Punjab National Bank, Life Insurance Corporation of India, Axis Bank, IDBI Bank, India Infrastructure Finance Company, Bank of Baroda, Andhra Bank, Corporation Bank, United Bank of India and India Infrastructure Finance Company (UK) (for the European Central Bank).

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