New Delhi: Cash strapped real estate major Unitech will seek approval from its shareholders to raise up to Rs5,000 crore through issue of securities at an extra-ordinary general meeting on Monday.
The company, which on 22 December, got board approval to raise long-term funds up to Rs5,000 crore, is currently passing through a huge credit crunch and is in talks with potential buyers to offload some of its hotels and commercial properties.
Unitech officials, however, insist that the seeking of approval from its shareholders is just to clear way to raise funds in future if needed.
“This is an enabling resolution that we have approved so that whenever we need to raise money, there is no requirement of going again to seek shareholders’ approval,” Unitech general manager (Corporate Planning and Strategy) R. Nagraju said.
Rating agency Fitch said last week that Unitech is in talks with banks to raise an estimated Rs900 crore loan over the next few days as it needs to repay an existing debt of Rs1,100 crore in the current month.
At the EGM, the shareholders would also consider increasing the authorised share capital of the company to Rs1,000 crore from the current Rs500 crore.
In December 2008, Unitech chairman Ramesh Chandra had said that the company is planning to raise up to Rs2,500 crore through sale of some assets and equity to retire part of Rs8,000 crore debt by March 2009.
Unitech shares, which are at the receiving end on the Dalal Street since 2007, closed at Rs30.10, down by 5.49% on the BSE on Friday last week.