New Delhi: The board of Oil and Natural Gas Corporation Ltd (ONGC) has approved a corporate guarantee of up to USD 412 million to facilitate fund-raising by its wholly-owned step-down subsidiary, OVL Overseas IFSC Limited (OOIL). The decision was made at a board meeting held on June 20, the company said in a filing to the stock exchanges.
The total guarantee amount includes a previously approved USD 257.5 million, cleared by the board earlier this year on January 31. The fresh approval brings the aggregate corporate guarantee to USD 412 million.
According to the filing, the funds raised by OOIL may be used for refinancing existing loans or for raising fresh capital. The proceeds will be routed to ONGC Videsh Limited (OVL) and/or ONGC Videsh Rovuma Limited (OVRL), or any other wholly-owned subsidiary of OVL, for the purpose of overseas direct investment (ODI) within regulatory limits permitted by the Reserve Bank of India and other authorities.
ONGC Videsh is the international exploration and production arm of ONGC. OOIL and OVRL are fully owned subsidiaries of OVL.