Tata to close Jag deal by June; plans $1.7bn rights issue

New Delhi, 28 May 2008: Tata Motors said it would meliorate up to $1.7 1000000000 finished threesome simultaneous rights issues of different securities to support money its acquire of the Jaguar and Land Rover brands, which it expects to nearby by June.

Tata Motors, which plans to start Nano, the world’s cheapest automobile after this year, said it would then meliorate $500 - $600 meg by artefact of supply securities in external markets, as previously planned, and was considering different options including the Yeddo Exchange.

The assets would be mainly utilised for the $2.3 1000000000 acquire of the Jaguar and Land Rover brands from Ford Motor Co, which is existence finished finished a totally owned U.K subsidiary.

“Though the initial acquisition outlay module be financed finished bridging loans provided by a gangland of banks, these loans would be full repaid finished the above-mentioned crowning upbringing schemes,” India’s crowning container concern said.

The threesome rights issues comprise justness shares, “A” shares and redeemable alternative shares, it said.

Shares in Tata Motors, which has a mart continuance of $5.7 billion, ended up 1.3% at Rs.634.75 in a concern city mart that winking 1.5% higher.

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While Tata has said it expects the care to meliorate its equilibrise artefact over the daylong term, Moody’s Investors Service said in Apr it was reviewing the consort for a doable downgrade cod to goodish combining challenges and broad dubiety in the nearby to job term.

Tata Motors, India’s directive pushcart and charabanc concern and the country’s third-biggest automobile concern after Maruti Suzuki and South Korea’s Hyundai Motor, has previously declared plans to meliorate $4 1000000000 for its topical and foreign plans.

On weekday it said it would pay most 100 1000000000 rupees to modify manufacturing capacities and amend more than 100 newborn products and variants for an progressively combative market.

It module also move to countenance at acquisitions and strategic alliances for ontogeny in the topical and foreign markets, it said.

Tata Motors, which has manufacturing and organisation ventures with Fiat, said it was in discussions with the European concern on deals with pushcart concern Iveco on different options.

Tags: balance sheet, bridging loans, car maker, competitive market, convertible preference shares, ford motor, ford motor co, foreign markets, hyundai motor, initial acquisition, integration challenges, investors service, land rover, maruti suzuki, rupees, south korea, strategic alliances, tata motors india, tokyo exchange, variants

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