Larsen Toubro LT, India's largest engineering and construction firm, yesterday raised $600 million from a combination of a qualified institutional placement QIP and five-year convertible bonds, which allowed it to get around the hurdles imposed by India's floor price regulations. The QIP and the CB were both launched with fixed terms and placed with a small group of investors.
By structuring the convertible bond with terms attractive enough to appeal to investors, including a conversion premium of just 15%, and by requiring those who subscribed for the bonds to also put in an order for the equities, the company was able to get away with pricing the equity at a discount of just...
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