JLR changes gear for future, to raise $400 m via senior notes
In a statement to the BSE, Tata Motors informed that “the net proceeds from the issuance and sale of the notes would be used by the company for general corporate purposes, including support to JLR's ongoing growth and capital spending plans.”
This is the second time in eleven months that JLR has issued senior notes on an unsecured basis. In March 2012, the company had issued 500 million pounds senior notes due in 2020 at a coupon of 8.25% per annum. In fiscal 2013, JLR estimates the total capital spending to be in the region of 2 billion pounds, of which it expects approximately 50% for R&D and 50% for expenditure on tangible fixed assets such as facilities, tools and equipment.
The company said it expects “capital spend to become a greater percentage of its revenue in the near to medium term in order to realise the present opportunities it sees for growth.” JLR's capital spending target as a percentage of revenues is 10-12%.
“Given the significant growth in our sales and profitability with a strong cash and liquidity position, we plan to continue to increase and accelerate capital spending to develop new products in new and existing segments, invest in new
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