Gulf News

Tata Steel may issue new shares and bonds

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India’s Tata Steel Ltd may consider options including a preferenti­al share issue and perpetual bonds to fund its takeover of Corus Group Plc, the Economic Times reported yesterday.

Tata Steel said on Tuesday that its board would meet on April 17 to consider proposals for raising equity funds to finance its investment in a special purpose vehicle for its $12 billion acquisitio­n of steel maker Corus, which analysts said could be a global depositary receipts issue or issue of rights.

The takeover was completed earlier this month.

Pattern

Tata Steel Managing Director B. Muthuraman said on January 31 that the company would pay $4.1 billion for Corus and finance the balance by debt.

The Economic Times said a global depositary receipts issue had gone down the preference list as Tata Steel would not be comfortabl­e about reducing the Tata group’s stake in the company.

But the Business Standard said Tata Steel was likely to go for a rights issue of nearly 35 billion rupees ($815 million) and that the issue may be priced at around Rs400 a share.

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