Billionaire Thapar’s BILT to Raise $330 Million Selling Shares in London

Indian billionaire Gautam Thapar’s BILT Paper Plc plans to raise about $330 million selling shares in London and use the proceeds to reduce debt and expand its paper mills in the South Asian nation.

The company will use $140 million to repay debt and about $170 million to enhance capacity, BILT said in a statement to the London Stock Exchange today. The shares of Ballarpur Industries Ltd. (BILT), India’s biggest paper maker, which controls BILT, gained 4.7 percent to 32.65 rupees as of the 3:30 p.m. close in Mumbai, after surging as much as 8 percent.

Economic growth is raising literacy levels in the world’s second-most populated nation where 65 percent of the country’s 1.2 billion people can read and write, according to the 2001 census, adding to demand for BILT’s products. Growth in demand for paper in India may exceed that of China this decade, rising 5.5 percent every year, BILT said in the statement.

“This growth in demand, which is closely correlated to growth in GDP and disposable income, has already led us to significantly expand our production,” Chairman R.R. Vederah said in the statement.

The share sale will reduce the founders’ holding in the company by at least 25 percent, B. Hariharan, director at parent Ballarpur said in a conference call with reporters today. BILT Paper will get listed in London by April 20, he said.

‘Choosing London’

“The idea of choosing London is to attract a new set of investors from the U.K. and other developed markets,” Ballarpur Industries’ Chief Executive Officer Yogesh Agarwal said on the conference call.

Ballarpur Industries holds 79.5 percent in BILT Paper through unit Ballarpur International Holdings BV. Lathe Investment Pte, a unit of Government of Singapore Investment Corp. owns 12.9 percent and JPMorgan Mauritius has the remaining 7.6 percent, according to the regulatory filing.

BILT has a capacity to produce 758,710 metric tons of paper and 250,000 tons of pulp, according to the statement.

Citigroup Inc. and JPMorgan Chase & Co. (JPM) are managing the share sale, according to the statement. Thapar is India’s 27th richest man with $2 billion in assets, according to Forbes magazine.

To contact the reporter on this story: Ameya Karve in Mumbai at akarve@bloomberg.net.

To contact the editor responsible for this story: Darren Boey at dboey@bloomberg.net.

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