Vedanta Resources to sell dollar bonds-term sheet

HONG KONG (Reuters) - India-focused mining group Vedanta Resources (VED.L) is aiming to sell a benchmark-sized dollar bond offering that will be rated high-yield, according to a term sheet sent to investors on Monday.

The offering comes amid a revival in bond sales from the region, including those below investment grade, and joins announced debt transactions from Trade Development Bank of Mongolia (TDBM) and Indonesia.

London-listed Vedanta will start a global bond investor roadshow on Wednesday, which may be followed by a bond sale, depending on market conditions. No schedule was provided in the term sheet.

Vedanta will use the proceeds to finance capital expenditures, working capital, repayments or redemption of existing debt, as well as for other general purposes.

The offering could be in one or more tranches, a source involved in the deal added, although details have yet to be finalised.

The proposed debt is expected to be rated Ba1 by Moody's, BB by Standard & Poor's and BB-plus by Fitch Ratings, the term sheet said, all of them below investment grade.

In April, Vedanta obtained financing for a $1 billion 4.75 year loan to refinance debt related to its purchase of a controlling 51 percent stake in Sesa Goa (SESA.BO) from Japan's Mitsui & Co (8031.T), Reuters' Basis point had reported.

Meanwhile, a unit of Vedanta, Sterlite Industries (STRL.BO) (SLT.N), said late last month it would buy the operating assets of bankrupt miner Asarco in an all-cash $2.6 billion deal, in what would be India's largest outbound M&A deal so far in 2008.

Bond sales from Asia had tumbled in the first quarter at the height of the global credit crisis, creating a backlog of regional issuers in need to raise money, bankers have said.