Tantia Constructions raises $7.5mn

Infrastructure company Tantia Constructions Ltd. (TCL) announced the closure of its $7.5 million offering of foreign currency convertible bonds (FCCBs), to be listed on Singapore Exchange Securities Trading Ltd.

SBI Caps (UK) Ltd acted as lead manager for the offering, which was placed with Lehman Brothers.

TCL intended to use the proceeds for funding assets, purchase of equipment and machinery, said Shaleen Khemani, director of TCL.

Khemani said the company had orders in hand worth Rs1500 crore and looked set to report 50 per cent growth year on year (Y-o-Y).

TCL would go in for capital expenditure of around Rs 15 crore for equipment, RMC plants and other related equipment necessary to bid for major build own transfer (BOT) projects of central and state governments.

Working capital pressures would also ease, said Khemani, while pointing out that a sanction to raise upto $25 million had been received from the company's shareholders.

Option of further issue would would be exercised depending on need, he added.

TCL was now qualified to bid for projects of upto Rs 500 crore and would continue to stick to its basic philosophy to never doing sub-contracting jobs.

TCL would also be bidding for power transmission projects, encouraged by the successful completion of such a project in Guwahati and progress at its ongoing Rajarhat power line project.

Khemani said TCL was qualified to bid for power projects of upto Rs 100 crore.

Aiport infrastructure in smaller towns would be another growth area, said Khemani.

TCL was at present constructing the new terminal building and allied works at the Coochbehar Airport in north Bengal under a contract awarded by the Airport Authority of India (AAI) through a competitive bidding process.

The cost of the Coochbehar project was Rs 12 crore and construction of terminal would be completed within 12 months, making it West Bengal's third airport after Kolkata and Bagdogra.

TCL would bid for a similar work at Port Blair airport and expected to complete a similar contract awarded earlier to upgrade the infrastructure at Dibrugarh airport, Khemani added.

The TCL FCCBs had a tenure of five years, falling due in 2012, and carried a coupon rate of 1 per cent.

The conversion price was Rs 140 per share, representing a premium of Rs 130 to face value and a premium of 25 per cent on the existing market price.