Moody's Offers to Increase Stake in India's ICRA

Moody's Corp. unveiled plans to seek a majority stake in ICRA Ltd., a provider of credit ratings and research in India, through a tender offer.

Moody's, a ratings and analytics company, offered to acquire up to 2.65 million shares of ICRA at a price of 2,000 Indian rupees (about $32.19) a share, a 26% premium over ICRA's closing price on the National Stock Exchange of India Ltd. on Thursday. The offer represents a 22% premium to ICRA's record-high closing price at the end of last year, Moody's said.

Full acceptance of the offer would boost Moody's ownership stake in ICRA to about 55%, from 28.5% currently, Moody's said in a statement. The offer is conditional upon Moody's acquiring at least 2.15 million shares, which would increase its ownership stake to slightly more than 50%.

Moody's, which relies on its debt-rating operation for the vast majority of its income, said it would fund the offer from international cash on hand and the tender period is expected to begin in April, subject to review of the deal by Indian regulatory authorities.

"We look forward to expanding and deepening our collaboration with ICRA as it provides research and ratings for the growing domestic debt market in India as well as other emerging markets in the region," said Moody's President and Chief Executive Raymond McDaniel.

Earlier this month, Moody's reported its fourth-quarter profit jumped as revenue grew in its structured finance segment. The company's shares have risen about 6% in the past three months.

Write to Erin McCarthy at [e-mail]

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