United Spirits Ltd has announced that its hareholders have approved a plan to raise about $225 million through foreign-currency convertible bonds (FCCBs).

The FCCB, which are convertible to equity shares, will include a greenshoe option of up to $50 million, United said in a filing with the stock exchange.

United Spirits, which is a part of the Vijay Mallaya led UB Group, had a total debt of Rs. 4,169.69 crore on 30 September 2011. The new bond issue is expected in early 2012 and is aimed at reducing the cost of debt and improves profitability of the company.

The board of the company had given its approval for the plans to raise the funds from foreign bonds on 21 December. The company has appointed Standard Chartered Bank, Rabo Bank and DBS Bank as advisers for the issue of the bonds.

"The members have unanimously approved the special resolution for issue of FCCBs, convertible into equity shares, for an amount not exceeding USD 175 Million with a green shoe option of an aggregate sum not exceeding USD 50 Million," United Spirits Ltd said in a filing to the Bombay Stock Exchange (BSE).