Tata: Growth drive

Mumbai, Jan. 25: Trent Ltd today announced a Rs 118.1-crore rights issue of partly convertible debentures with warrants. The rights entitlements will be issued to the existing shareholders in the ratio of 1:10, the board said.

Unveiling the details of the rights issue that looked slightly complicated, Trent today informed the stock exchanges that the instrument will have a face value of Rs 900 apiece and will comprise three parts.

Part A will be converted into one share (of the face value of Rs 10) at a price of Rs 400 on allotment. Part B will be one non-convertible debenture of Rs 500 with a coupon rate of 2 per cent and a redemption premium payable on maturity to give a yield-to-maturity of 5.5 per cent per annum over a five-year period.

The third part will have one warrant, entitling the holder to acquire against payment in cash one share of Trent during the exercise period in the third, fourth or fifth year, at a price between Rs 650 and Rs 750 apiece as may be fixed at the time of the issue.

While promoters hold a 26.28 per cent stake, the Indian public own 41.54 per cent. The remaining is divided between institutional investors (20.73 per cent) and others, including private corporate bodies and NRIs/OCBs.

The rights issue of Trent comes at a time when the company has firmed up plans to step up its presence in the retailing segment.

At the company's annual general meeting in September last year, chairman Simone Tata had presented a positive outlook for its retailing business and divulged plans to venture into the hypermarket sector.