Sustainable energy firm ReNew Power Pvt Ltd has raised $450 million through a dollar bond issuance, a senior executive at the company told Mint.

“The firm’s order book of 3x for such a long tenor paper and high participation from investors across the US and Europe is very encouraging and reflective of the company’s prospects and its healthy leverage levels," said D Muthukumaran, chief financial officer of ReNew Power.

The bonds, according to a person directly aware of the matter who spoke on the condition of anonymity, are priced at a coupon rate of 5.875% and will be issued in two tranches with an average maturity of five and a half years. “But most funds will be raised through bonds that have seven years to maturity," he added.

On 12 January, rating agency Fitch Ratings rated the US dollar senior secured notes to be issued by the firm at ‘BB-/Stable’.

ReNew plans to use the proceeds from the dollar notes to mainly refinance the existing borrowings, including trade credit facilities of the holding company. Part of the proceeds worth nearly $65 million, will also be used to meet future capital expenditure requirements.

“The funds are being borrowed mainly to refinance debt which is maturing in the coming year. This would help the company extend its loan tenure by a good seven years. On the whole, this will be a debt-neutral transaction as the firm’s overall leverage will not increase," the person cited above said.

The firm’s leverage ratio, or its net adjusted debt-to-operating EBITDA (earnings before interest depreciation and amortization) ratio, stood at over 5.5 times on a sustained basis, according to Fitch.