Mumbai: Tata Steel, which acquired Anglo-Dutch steel maker Corus in January, will raise over $2.5 billion (Rs10,000 crore) through issue of securities in domestic and overseas market to part finance the acquisition.

>The company would come out with a rights issue of ordinary shares and cumulative convertible preference (CCP) shares, besides issue of securities in the domestic or international markets, Tata Steel said in a notice to shareholders.

>While Rs3,655 crore is planned to be raised through a rights offer, another Rs4,350 crore would be raised through issue of CCP shares. Existing shareholders would get one share at a price of Rs300 for every five ordinary shares held.

>Tata Steel would also raise additional funds up to $500 million (Rs2,042 crore) from the domestic and international markets.

>To facilitate issue of CCP shares, Tata Steel said, the authorised share capital would have to be raised from Rs2,000 crore to Rs8,000 crore.

>Tata Steel had paid $4.1 billion toward acquisition of Corus that was valued at $12.9 billion.

Chairman Ratan Tata has, meanwhile, assured shareholders that the acquisition of Corus would in no way jeopardise either the long-term shareholder value or Tata Steel''s dividend paying capacity.

In his first formal statement to the minority shareholders since the takeover, he said the financing of Corus acquisition had been structured to ring-fence Tata Steel''s balance-sheet and protect the interests of its shareholders''.

Although the competitive bid raised the acquisition price, the chairman reiterated, "I believe that when one looks back at this acquisition, even at this price, it will be seen as a bold visionary move".

This proposal would be moved as a resolution at the annual general meeting of the company next week. Tata Steel''s 100th annual report also mentioned plans to raise an amount not exceeding $500 million (Rs2,042 crore at the current exchange rate).

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