Tata raises funds to repay Jaguar loan
MUMBAI: Top Indian vehicle maker Tata Motors has raised 840 million dollars in debentures to partly repay a loan taken to finance its purchase of British car icons Jaguar and Land Rover, a statement said.
Tata took a three-billion-dollar bridge loan last year to buy the prestige marques but has been struggling to repay the money against the backdrop of the global financial crisis, which has made credit harder to come by.
"The funds raised will be used for part repayment of the three-billion-dollar bridge facility taken for acquiring Jaguar Land Rover," Tata Motors said in the statement late Wednesday.
Tata Motors, part of the tea-to-steel Tata Group, tapped local Indian markets for the funds.
It had already repaid 1.11 billion dollars of the loan with the balance due to be paid by next month.
"The (debenture) issue was quite a success and well subscribed," Tata Motors chief financial officer C. Ramakrishnan said in the statement.
The issue drew interest from mutual funds, banks, insurance companies and financial institutions, the company said.
Tata Motors bought the loss-making Jaguar and Land Rover brands from ailing US giant Ford Motor for 2.3 billion dollars. But the worldwide recession has slammed sales of the luxury vehicles.
The company has said it plans to begin selling Jaguar and Land Rover vehicles in the Indian market later this year. It will import the vehicles from Britain.