New Delhi: As part of the long term financing plan of Tata Steel Limited, the company announced on 6 August that it has priced the issue of Foreign Currency Convertible Alternative Reference Securities (CARS) aggregating to $ 725 million which was oversubscribed by more than two times.
There is a green shoe option of $150 million which has not yet been exercised. Application will be made to list the CARS on an overseas stock exchange.
The CARS will be convertible into either Qualifying Securities (which may be in the form of depositary receipts with restricted rights of withdrawal representing underlying ordinary shares with differential rights as to voting) or ordinary shares.
The CARS will be convertible at an initial conversion price of Rs.876.6225 per share, which is at a premium of 35% to the Company’s closing share price on the National Stock Exchange of India Limited as on 6 August 2007.
The CARS carry a 1% coupon and the effective YTM is 5.15% . The outstanding CARS, if any, at maturity will be redeemable at a premium of 23.3419% of the principal amount. The issue is subject to fulfillment of certain Conditions Precedent.
Citigroup acted as the sole global coordinator and book runner to the offering with ABN AMRO Rothschild and Standard Chartered Bank being the joint book runners .
This announcement is not, and is not intended to be, an offer of securities for sale in the US. Securities of Tata Steel Limited may not be offered or sold in the US absent registration or an exemption from registration under the US Securities Act of 1933.
There is not, and is not intended to be, a public offering of the securities of Tata Steel Limited in the US.