Capital Int'l picks up 2.7% in Mcleod

Borelli Tea Holdings has sold 2.7% of its holding in Mcleod Russel India, the tea company in Brij Mohan Khaitan's portfolio, to foreign institutional investor Capital International.

Aditya Khaitan, MD of Mcleod Russel, said the shares were bought by Capital International at Rs 123.5 per share.

In July, Capital International bought 2.54% stake from a trust and Williamson Magor & Co.

The Mcleod scrip today closed at Rs 125.10 on the National Stock Exchange with volumes of 2,988,381 shares.

Khaitan said, the transactions were aimed at reducing debt of the company. The current transaction entailed sale of shares by Borelli.

"Promoters are not selling shares and the money will go to the company since Borelli is a subsidiary of Mcleod Russel India," he pointed out.

Borelli used to be the holding company for Williamson Tea Assam, which was acquired by Mcleod and in turn merged with it.

So far, Mcleod had garnered Rs 58.34 crore from the sale of shares. The company plans to raise another Rs 130 crore this year.

Mcleod would opt for the qualified institutional placement route for raising the money.

The company plans to retire around Rs 200 crore debt this financial year. Mcleod's debt including working capital amounts to around Rs 475 crore.

The debt accrued from the two acquisitions - Williamson Tea Assam and Doom Dooma Tea - last year.

The company raised Rs 145 crore for the Williamson Tea Assam acquisition and Rs 72 crore over a four-year period for Doom Dooma Tea.