Ratan Tata, chairman of Tata Tea, said here after the company's annual general meeting that before setting up the SPV, the company would issue GDRs worth US $ 100 million.

Shareholders approved the twin resolutions of issuing GDRs and acquisition of Tetley. Two foreign bankers were currently carrying out due diligence exercise for Tetley acquisition, Tata said, adding the cost involved would be around pounds 50 million to pounds 75 million.

Besides the GDR issue, Tata Tea would raise some loan in addition for Tetley acquisition and an investment banker would hold some share in the SPV, he said. Explaining the reason behind Tata Tea not acquiring Tetley directly, he said that this was done primarily to insulate the domestic company from fluctuations in the global industry.

Terming it as a "big acquisition", Tata said Tetleyhad not been a profitable company in the recent past and it just made a turnaround. The profitability projections for Tetley was 36 million pounds in the current financial year and once the Tetley operations under Tata management stabilised it would be merged with Tata Tea.

Tata said the company was keen to establish its brand name in the global market and that was why it was planning to acquire Tetley, the second largest tea company in the world. Once the company is under Tata fold, Tata Tea would gain by way of increased access to overseas markets, Tata added.