Tata Steel garners Rs508 cr from key investors ahead of FPO
19 January 2011
Tata Steel has raised Rs508 crore from 33 anchor investors ahead of its follow-on public offer that opens today. The share sale was at the upper end of an indicated price range, reflecting investor optimism in the company's prospects in India's fast-expanding economy.
Major investors include the Abu Dhabi Investment Authority, Government of Singapore, and investment units of Fidelity, Morgan Stanley, Credit Suisse, Macquarie and ICICI Prudential, exchange data showed.
The world's seventh-largest steelmaker issued 8.325 million shares, or nearly 15 per cent of the total offer, to the 33 anchor investors, according to the data issued late on Tuesday. Tata Steel is in the market to raise a maximum of Rs3,477 crore by issuing 570 lakh shares, or 5.9 per cent of equity, in the follow-on public offer at Rs594 to Rs610 each.
The proceeds will be used to fund a 3-million-tonne capacity expansion at its Jamshedpur plant in eastern India, repay debt worth 10.9 billion rupees and invest in other projects.
RBS, HSBC , SBI Capital , Citigroup , Deutsche Bank , Standard Chartered and Kotak Mahindra are the managers to the offering.
Indian companies raised $24.9 billion from equity issues in 2010, up 22 per cent from the previous year, ThomsonReuters data showed. The fundraising has been bolstered by a firm stock market and surge in foreign inflows as overseas investors seek broader exposure to an economy growing at 8.5 per cent.