Indian Hotels plans to raise Rs 1,000 cr via debentures

MUMBAI: Tata group hospitality major, Indian Hotels Company (IHCL), has sought market regulator Sebi's approval to raise Rs 1,000 crore through issue of debentures on rights basis.

As per the draft offer document filed by IHCL with Sebi, the company is planning to issue "compulsorily convertible debentures (CCDs)" for an amount "not exceeding Rs 1,000 crore on a rights basis to eligible equity shareholders of the company..." IHCL intends to utilise part of the proceeds from the issue towards capital expenditure proposed to be incurred on construction of Vivanta by Taj in Guwahati.

Besides, the firm would use the funds for repayment or pre-payment of certain borrowings, funding of capital expenditure related to renovation proposed to be undertaken at some of its hotels as well as for general corporate purposes.

JM Financial Institutional Securities, DSP Merrill Lynch, SBI Capital Markets and Standard Chartered Securities (India) are the lead managers to the issue. Link Intime India is the registrar to the issue.

IHCL is engaged in the business of owning, operating and managing hotels and resorts. It operates the Taj Mahal chain of hotels and resorts. Some of its well-known hotels include Mumbai's Taj Mahal Palace and Ummaid Bhawan Palace in Jodhpur.