Jaguar Automotive plc. , a fully owned subsidiary of Tata Motors an Indian company. They announced bond issue of value $500 million. The profits of this issue were to be refinanced with issuance of expensive outstanding bonds.
The business managed to increase new debt at significant lower rates of interest than its outstanding debt as an outcome of its continual good performance, which led to improved credit ratings and strong company fundamentals.
Students will assess the many motivations for such a fiscal strategy, whether it'll lead to cost savings or income savings and, if so, the degree of the savings.
S. Veena Iyer is affiliated with Management Development Institute-Gurgaon.
PUBLICATION DATE: July 31, 2015 PRODUCT #: W15332-HCB-ENG
This is just an excerpt. This case is about FINANCE & ACCOUNTING
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