Tata Motors ups size of QIP offer on strong response

Tata Motors Ltd, India's biggest truck-maker and also the owner of the Jaguar, Land Rover, and Nano car brands, has raised $750 million (Rs3,325.5 crore) from a sale of shares to institutional investors, according to a Bloomberg report quoting three people with direct knowledge of the matter.

The deal, which started on 1 October, was increased from $525 million (Rs2,300 crore) after investors bid for at least 3.4 times the shares on offer, the people said, declining to be named before an official announcement.

The issue includes $550 million of so-called 'A' shares with differential voting rights. The Mumbai-based company initially planned to sell $325 million of A shares with an option to increase the offer in response to demand, according to a statement to the Bombay Stock Exchange today. The automaker also sold $200 million of ordinary shares, the people said.

Citigroup Inc and Credit Suisse Group AG managed the sale, according to the statement. Tata Motors offered the ordinary shares at Rs1,074 each and the A shares at Rs764, according to a term sheet seen by Bloomberg News.

Tata Motors had on Friday launched the institutional share sale offer with the initial aim to raise over Rs2,300 crore.

The company intends to use the proceeds primarily for reducing debts, capital expenditure and long-term capital requirements among other things, a company statement said. It also said that shareholders through a postal ballot on 10 August this year had approved the offer.

The shares are proposed to be listed on both the Bombay Stock Exchange and the National Stock Exchange.