Indian Hotels plans $150m overseas issue

Indian Hotels Company, the flagship of the Taj group of hotels, is looking to double the amount it is planning to raise through an overseas issue to about $150 million.

The company is also proposing an issue of cumulative redeemable preference shares of Rs 100 crore through a private placement. It is also increasing the borrowing powers of the directors to upto Rs 2,000 crore.

Indian Hotels has convened an extra-ordinary general meeting of its shareholders on January 27 to ratify the fund-raising plans.

Company executives were unavailable for comment.

Indian Hotels has been looking at acquiring properties in New York, San Francisco, Los Angeles and Singapore as well as at the key international leisure destinations and also in fast growing markets such as Shanghai and Beijing in China.

Even within India, the Taj group is looking at a major expansion plan. In three years, it plans to increase the number of business hotels from 18 to 30. Overseas, it has also kept its options open on acquiring a hotels chain.

The board of the company has authorised a committee of directors, to examine and evaluate alternate fund raising methods.

The funds could be raised through foreign debt instruments, and or issue of equities or warrants.

Earlier, the Tata group company was looking at raising around $75 million (or over Rs 350 crore) as part of its long-term fund raising plan.

The company has three divisions""luxury, leisure and business. The luxury segment contributes the largest to IHCL's turnover.