Tata Motors board approves Rs 7,500 cr rights issue

Tata Motors, India's biggest automaker, has secured board of directors approval for a Rs 7,500 crore rights issue to fund its on-going and future activities.

The Mumbai-based company will issue little over 150 million ordinary shares at Rs 450 per share.

and 26.5 million 'A' Ordinary shares at Rs 271 per share. The issue price is 16% lower than the stock price of Rs 535 trading on the Bombay Stock Exchange"The above terms would be subject to the approvals of Sebi, Reserve Bank of India and all other appropriate authorities as may be necessary and/or subject to such conditions as may be imposed by any of them while granting such approvals, which may be agreed to by the Board of Directors and/or a committee thereof", the company stated.

The company's board also approved the buy-back of Secured Non-Convertible Debentures worth Rs 1250 crore issued by it in May 2009, maturity date being March 31, 2016. The buy back is a part of its debt restructuring programme to ensure a healthy debt equity mix, balanced maturity profile, better terms that would include lower cost of debt.A more detailed plan states eight improved and enhanced vehicles across five key brands over next two or three years and products offered on a new modular platform from 2016-17.

On the commercial vehicle front the company is working towards launching 100 products in 2-3 years to improve sales as well as safeguard its market share.

Tata Motors