Sterlite launches $2 billion ADS offer;

05 June 2007

Mumbai: Vedanta group flagship Sterlite Industries has commenced an American depositary shares (ADS) issue to raise around $2 billion for funding expansion plans, including buyouts. The company will offer 125 million shares with a green shoe option of 18.75 million shares.

The issue price will be on basis of the company''s share price in India, which closed around $13.65 on June 1. At this rate, Sterlite would be able to mop up around $1.96 billion (about Rs8,000 crore).

The ADS price would not be more than five per cent or less than 10 per cent of its India price, the company said in a filing with the US Securities and Exchanges Commission.

Post offer, the shares will represent about 18.3 per cent interest in Sterlite and the company has applied to get the ADS listed on the New York Stock Exchange under the symbol ''''SLT'''', Sterlite Industries (India) Ltd, (SIIL) said in a release to the BSE.

Sterlite Industries had in May announced plans to raise $2 billion through ADS issue for acquisitions, increasing stake in subsidiaries and setting up a thermal coal-based power facility in Orissa for around Rs8, 730.5 crore.

The company is also planning to acquire the remaining 29.5 per cent government stake in Hindustan Zinc Ltd, for around Rs9,230 crore, from the proceeds of this offering. The ADS proceeds may also be used for reduction of debt of up to Rs689.3 crore ($150 million).