Correction: India’s REC gets necessary consents from noteholders at meeting

A story published March 13 for the March 14 edition of the Prospect News Liability Management Daily reported that REC Ltd. had received consents from noteholders. This is now true, as of March 14, but as of March 13 approval had been obtained from the RBI for the payment of the consent fee and consents had not yet been received from noteholders. A correction and updated version of the story appears below.

Chicago, March 14 – REC Ltd. announced that it has received the necessary consents from noteholders and will pay the consent fees to noteholders who gave a valid consent instruction, according to a notice.

As announced Feb. 20, the company solicited consents for its $400 million of 3.068% notes due 2020, its $700 million of 5¼% notes due 2023, its $450 million of 3 7/8% notes due 2027 and its $300 million of 4 5/8% notes due 2028.

The consent fees are $15 per $1,000 of notes for the 3.068% notes, $5 per $1,000 of notes for the 5¼% notes, $50 per $1,000 of notes for the 3 7/8% notes and $30 per $1,000 of notes for the 4 5/8% notes.

As previously reported, the company was seeking approval from holders for a waiver of some rights of holders and modification to the terms and conditions of the notes, each in connection with the sale by the government of India of its existing shareholding in the issuer to Power Finance Corp. Ltd.

Under the proposed extraordinary resolution, the issuer asked holders to waive any right to require an early redemption or prepayment of the notes by exercising their change-of-control redemption right or triggering an event of default.

The issuer was also seeking to amend the definition of “change of control” under the terms and conditions relating to the redemption right and to delete the relevant event of default.

The extraordinary resolution was passed, the relevant amended and restated pricing supplement was executed and the extraordinary resolution in respect of the relevant series of notes is now effective.

Formerly Rural Electrification Corp. Ltd., REC is a public infrastructure finance company based in New Delhi. The company promotes rural electrification projects across India.

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