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Sources say that India's third biggest airport operator is looking to close a bond in October for more than $500 mln,

Three sources said on Monday that India's Bangalore International Airport Ltd. (BIAL) intends to raise more than 46.3 billion rupees (535 million dollars) through a second tranche bond by early October.

The company that operates the third busiest airport in the country raised 43,62 billion rupees earlier this month through the sale 15-year bonds with a coupon rate of 8.15%, payable monthly.

Sources added that BIAL would raise funds in its second tranche, at the same rate as it did for the first transaction.

All sources asked to remain anonymous as the discussions are still confidential. The company didn't immediately reply to an email asking for comment.

Crisil Ratings India Ratings & ICRA have all given the bonds a AAA rating.

Two sources confirmed that SBI Capital Markets arranged the first tranche and will arrange the second as well.

Sources said that the second tranche of bonds will also have a maturity of 15 years and be private placed, and not auctioned through the electronic bond platform.

One source said, "The deal was completed with the participation of banks, insurance companies and funds focused on infrastructure,"

According to the person, money raised would be used to refinance existing debts and for new capital expenditure.

According to an ICRA Report, BIAL plans to spend 155 billion rupees on capital expenditures for capacity expansion over the financial years 2026-2030.

It is estimated that the passenger handling capacity will increase to 80-85 millions passengers annually from its current 51.5 million. ($1 = 86,5200 Indian Rupees) (Reporting and editing by Nivedita Battacharjee; Khushi Mhotra & Dharamraj Dhutia)

(source: Reuters)