Close on the heels of acquiring UK luxury auto brands Jaguar and Land Rover (JLR) for $2.3 billion early this month, Tata Motors on Tuesday said the company is looking at further acquisition opportunities and strategic alliances in India and abroad, and is seeking to raise $1 billion in debt or equity from the overseas market.
The company said it is also seeking shareholder approval to raise its borrowing limit to Rs 20,000 crore. In 2007, the company had taken shareholder consent to borrow up to Rs 12,000 crore. This is now being sharply revised upward.
?The company has major growth plans for expanding its product range and presence in the domestic and global markets in commercial and passenger vehicles, including strategic alliances and acquisition opportunities,? Tata Motors stated in a notice sent to shareholders seeking approval on various issues such as its fund raising plans.
The company said it sought shareholder approval to raise up to $1 billion through the issue of foreign currency convertible bonds or equity shares in the international market. Shares of Tata Motors closed at Rs 512.90 on the BSE on Tuesday, down 0.81%.
The company is simultaneously seeking approval to increase its authorised share capital to Rs 3,900 crore, comprising ordinary shares aggregating Rs 700 crore and ?A? ordinary shares worth Rs 200 crore, as well as convertible cumulative preference shares worth Rs 3,000 crore.
As part of its long-term funding plans, Tata Motors would raise Rs 7,200 crore through three simultaneous but unlinked rights issues to part-finance the JLR deal. Under its rights issue programme, it would issue ?A? ordinary shares carrying differential voting rights for up to Rs 2,000 crore on a rights basis.
?A? shares would have voting rights at the rate of one vote for every ten ?A? ordinary shares. Except for this, ?A? shares would rank on par with ordinary shares of the company and holders would be entitled to, inter alia, dividends and bonus issues.
Tata Motors said it would continue to pursue its growth plans in the commercial and passenger vehicle businesses in India and overseas, through the introduction of new products/variants, new and upgraded manufacturing facilities and by investing in technology. ?These would be appropriately funded over the next few years,? the company stated.
