Domestic giant Tata Steel today said it will raise Rs 16,500 crore through debt instruments to fund Rs 32,500 crore acquisition of Bhushan Steel Ltd (BSL). The remaining amount will be raised through internal resources, it said. The banks, according to industry experts, are expected to take a whopping haircut of about 30-35 per cent in the sale of BSL to an arm of Tata Steel. However, Tata Steel refused to comment on the haircut taken by the banks and financial institutions. "We will be paying a total consideration of Rs 35,200 crores. This is expected to give us about 72.65 per cent equity in the company and close to 100 per cent of economic interest in the company because of the way in which the transaction has been structured," Tata Steel told PTI in an e-mailed response. From a financing perspective, it said, the transaction is largely financed by "our cash and incremental debt is only about Rs 16,500 crores which will be raised on the target balance sheet eventually". The company said Bhushan Steel will have about Rs 16,500 crore of secured debt and it would be contributing significant amount of its own capital into the BSL, so the incremental capital structure will be healthy and sustainable for the future. "And we believe that with synergies getting realized over a period of time, we have a good match between the earnings capability of the entire facilities and assets and the capital structure that we are putting in," it said. Stressing that Bhushan Steel has been a very important acquisition for the company, it said Bhushan Steel's Odisha plant is 150 kms away from Tata Steel's Kalinganagar plant. "It is a running plant with good facilities and we believe it will complement our existing footprint, not only in Odisha but also in the important markets that we operate in. We hope to achieve a kind of 100 per cent ramp up in the next couple of years, and we see significant scope for additional synergies and improvement in the operating KPIs (key performance indicators)," the steel giant said. Bhushan Steel is currently operating at around 3-3.5 million tonnes, Tata Steel said, adding that it expects the plant to be operational at 4-4.5 MT level quite easily. Bamnipal Steel Ltd (BNPL), a wholly-owned subsidiary of Tata Steel, completed the acquisition of controlling stake of 72.65 per cent in Bhushan Steel Ltd (BSL) last week. Leading law firm Amarchand Mangaldas was advisor to the Committee of Creditors (CoC). Tata Steel Ltd had won the bid to acquire debt-laden BSL in an insolvency auction. The bankrupt firm was among the 12 stressed assets the RBI had referred for NCLT proceedings last year.