Tata Investment Corporation to raise Rs723 crore in rights bonds

17 May 2008

Tata Investment Corporation will raise a total of Rs723 crore through a rights issue of zero-coupon convertible bonds via issue of warrants.

The rights issue the company would raise Rs448 crore in 2008 and possible another Rs275 crore in 2011, the company said in a filing with the Bombay Stock Exchange.

The zero coupon bonds of a face value of Rs650 will have three parts.

The first two will automatically and compulsorily convert into one ordinary share of  Rs10 at a premium of Rs290 and Rs340 in October 2008 and 2009, respectively, which will raise a total of Rs448 crore.

The third part will consist of detachable warrant, which can be purchased by the holder, at his option, against a price of Rs400 for one ordinary share in April 2011. If these warrants are exercised the company would receive a sum of Rs275 crore.

Tata Investment Corporation together with Tata Sons is a promoter of the Tata Mutual Fund.