Mumbai: Bharat Forge Ltd, the world’s second largest forgings maker, said on Tuesday that its board has approved raising up to $150 million via issue of equity or equity linked securities, to meet long-term capital requirements.
“The Pune head-quartered company will be using the funds to expand manufacturing capabilities in the non-automotive sector in India,” Amit Kalyani, its executive director told television channel CNBC-TV18.
“We have seen tremendous traction and growth opportunities in non-automotive segment and want to be prepared to fund those growth opportunities and capture larger growth,” he said.
Kalyani said that the board will decide in consultation with its investment bankers on whether they choose the global depositary receipts (GDR) or qualified institutional placement (QIP) route.
“The issue will result in 10-12% dilution of equity,” he said.
It will now seek shareholder approval along with other statutory approvals, the company said in a statement.
In November 2008, Bharat Forge entered into two joint ventures (JV) with Alstom Power Systems, a unit of French power and transport equipment maker Alstom, for power plant equipment.
In January, Bharat Forge formed another JV with French firm Arveva to make heavy forgings in India to be used in the nuclear power sector.
At 1:55 pm shares in the company were up 4.77% to Rs221.8 in a Mumbai market that was up 1.31%.