Preferential issue will be used mainly to reduce IHCL’s debt
Indian Hotels, which owns Taj, Vivanta by Taj, The Gateway and Ginger brand of hotels, plans to raise Rs 850 crore through a preferential issue to cut debt and recapitalise it.
The Tata group company’s move will raise promoter’s stake to 37.55 per cent from 30.27 per cent once warrants are converted in 18 months.
“IHCL is raising equity in order to strengthen its balance sheet. The company expects to raise around Rs 850 crore in two tranches, part of which will be raised in the current financial year and the balance in 18 months. IHCL will use these proceeds for retirement of debt,” a spokesperson said.
IHCL has standalone debt of Rs 2,362 crore and consolidated debt of Rs 4,210 crore.