Hindustan Times Ltd is raising Rs 75 crore (Rs 750 million) in debt and hiving off its print media business into a separate company, according to credit rating agency Crisil.

The debt will be raised through a non-convertible debenture issue of Rs 25 crore (Rs 250 million) and a commercial paper programme of Rs 50 crore (Rs 500 million). At the moment, the company is debt-free.

Hindustan Times executive president Rajan Kohli confirmed the debt issue but declined to comment on the plan to float a separate company for launching a Mumbai edition of Hindustan Times. He said the money would be used for financing its normal operations.

Apart from the proposed debt issue, more money is set to flow into Hindustan Times' coffers as the company is planning to sell 20 per cent stake to AMP of Australia for Rs 125 crore (Rs 1,250 million).

With a total of Rs 200 crore (Rs 2,000 million) in its kitty, the KK Birla-owned paper will be better placed to take on The Times of India in Mumbai, sources close to the development said.

Meanwhile, Crisil has placed the outstanding ratings on non-convertible debentures and the commercial paper programme of Hindustan Times under "rating watch with developing implications". Crisil has given an 'AA' rating to the debenture issue and 'P1+' rating to the commerical paper programme.

According to a Crisil press release, it is in dialogue with the Hindustan Times management to ascertain the various implications of its decision to hive off its print media business and infusion of foreign direct investment in the new media entity.

Crisil would take a final view on the rating after making a detailed assessment of the impact of the development, the press release said.