Deal Street

May 15, 2017

Issuance of India's First State Government Revenue Supported Bonds by UP Power Corporation

Uttar Pradesh Power Corporation Limited

Cyril Amarchand Mangaldas acted as legal counsel to Trust Investment Advisors Private Limited (Arranger) on the first state government revenue supported bonds aggregating up to INR 6,510 crores (Bonds) issued by Uttar Pradesh Power Corporation Limited, a subsidiary company of the Government of Uttar Pradesh (GoUP).

The entire state government revenue is available for servicing of the Bonds. The payment servicing for the Bonds is supported by a Reserve Bank of India (RBI) backed structured debt servicing mechanism. Under this mechanism, in the event the Bond servicing account falls short of the requisite amount, and if the GoUP is unable to fund it by a specified date, the RBI will debit the requisite amount from the GoUP’s account with the RBI and credit it to the Bond servicing account to ensure timely servicing of the Bonds.

On the basis of this structure, the Bonds have been granted a provisional AA rating by India Ratings and Research Private Limited. The Bonds are also backed by a sovereign guarantee provided by the GoUP.

The Cyril Amarchand Mangaldas team that advised Trust Investment Advisors Private Limited was led by Mumbai based banking partner Leena Chacko.

The signing of the documents happened on February 16, 2017 and closing was on February 17, 2017.

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