Indian Oil has invited bids from banks to raise a secured overnight financing rate (SOFR)-linked syndicated loan of $600 million (about ₹4,518 crore) to repay earlier loans that were benchmarked to the London Interbank Offered Rate, or LIBOR, multiple sources told ET.

LIBOR has been replaced by SOFR as the internationally acceptable reference rate since January 1.

India’s largest oil refiner and fuel retailer will raise the loan in four tranches with maturities ranging from 1.7 to 2.5 years as per the details communicated to the banks, sources said. The retailer has called for firm bids by February 24.

Banks can submit bids to underwrite the loan individually or in a consortium with other banks. However, the number of consortium members is capped at three.

Syndication is a method where a small number of banks underwrite a loan and then market it to other local and international banks that pick up portions of the total. The loan will be benchmarked to the 3-month SOFR rate, which was 0.04% on Friday. Emailed queries to Indian Oil didn’t elicit any response.

The oil major accounts for half of India’s petroleum products sales. It has revenues of Rs. 5 lakh crore. The company has total borrowings of Rs. 1 lakh crore. The company owns 11 out of 23 oil refineries in India, has a 15,000 km-long pipeline network and the highest number of fuel retailing outlets. It also is the largest provider of fuel to the airline sector.