Reliance Industries Ltd (RIL) has signed a $736 million-equivalent green loan to fund its acquisition of Norwegian solar panel manufacturer REC Solar Holdings, marking the first such financing for the Indian conglomerate, the company said on Monday.

ANZ, Credit Agricole, DBS Bank, HSBC and MUFG were the lenders on the borrowing, which was signed on November 29.

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"The borrowing is split into a $250 million six-year term loan, a $150 million working capital facility and a $460 million five-year bank guarantee facility. ANZ and MUFG took $70m each of the term loan, while DBS and HSBC took $40m apiece. Credit Agricole was allocated $30m, " RIL said.

DBS, HSBC and MUFG took equal shares of the working capital facility, while the first two named banks split the bank guarantee facility equally.

The term loan pays an interest margin of around 120bp–125bp over Libor.

Singapore-incorporated REC Solar is the borrower on the loan, while Reliance New Energy Solar, a wholly owned subsidiary of RIL and the acquiring entity, is the guarantor.

Reliance New Energy Solar this October acquired REC group from China National Bluestar (Group) Co. Ltd at an enterprise value of $771 million.

To be sure, RIL this June said it would be investing ₹75,000-crore in its clean energy push over three years, which would be through internal accruals. RIL plans to spend ₹60,000 crore on four giga factories at Jamnagar to produce solar cells and modules, energy storage batteries, fuel cells and green hydrogen. One of the four factories will make solar photovoltaic (PV) modules.

The borrowing is also a rare acquisition financing from the Indian oil-to-telecoms conglomerate, which opted for a term borrowing instead of a short-term bridge facility as is typically employed in most M&A situations, RIL said in a statement.

Drawdown of the loan took place on December 1 after which all outstanding liabilities at REC Solar were settled and the acquisition was completed, RIL added.

REC Solar is a 25-year-old company with three manufacturing facilities – two in Norway for making solar grade polysilicon and one in Singapore making photovoltaic cells and modules.

RIL plans to use REC Solar's industry-leading technology in its fully integrated, metallic silicon to PV panel manufacturing giga factory at Dhirubhai Ambani Green Energy Giga Complex, Jamnagar, initially starting with 4GW per annum capacity and eventually growing to 10GW per annum.

The green financing is the only loan from RIL so far this year. In November last year RIL closed a $1.4bn club loan with 14 banks.