Reliance Infrastructure plans to raise ₹6,000 crore via share sales

Mumbai: Anil Ambani-led Reliance Infrastructure Ltd on Thursday announced its plan to raise up to ₹6,014 crore through sale of shares and convertible warrants, a day after the company settled its arbitration battle with Adani Group over power distribution and a loan dispute with CFM Asset Reconstruction.

In a late evening release, following a board meeting, Reliance Infrastructure said its board has approved a plan to raise ₹3,014 crore through a preferential issue of up to 125.6 million equity shares or warrants (convertible into equivalent number of equity shares) for cash, at a price of ₹240 per share.

Following the news of the company's dispute settlements and claims to have turned debt-free on Wednesday, Reliance Infrastructure's stock was trading in the green and closed higher at ₹284.75 per share on BSE.

On Thursday, the company said its board has also approved a plan to raise up to ₹3,000 crore via a qualified institutional placement (QIP).

For this the company will seek shareholders' approval soon.

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Reliance Infrastructure, which is primarily engaged in the business of power distribution in Delhi and providing EPC services. The company also operates certain projects in defence sector and maintains the infrastructural aspects of certain Metro services, toll roads and airports through its special purpose vehicles.

Following the Thursday board meeting, Reliance Infrastructure said it will use the proceeds of the proposed preferential issue for expansion of business operations either directly or through investment in subsidiaries and joint ventures.

The money may also be utilized to meet the company's long-term working capital needs, said the firm.

The shares in the proposed preferential issue will be alloted to a promoter group company called Risee Infinity Pvt. Ltd, and to a few other investors namely Florintree Innovation LLP and Fortune Financial & Equities Services Pvt. Ltd, said the company, adding that the preferential issue will increase the promoter's effective holding in Reliance Infrastructure.

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Further, the preferential issue will enhance Reliance Infrastructure's networth from ₹9,000 crore to over ₹12,000 crore, said the company.

"The company has near zero debt. The enhanced capital will support the company’s participation in high growth sectors to aid the government’s vision of ‘Make In India’ and ‘Viksit Bharat’," added the company.

On Wednesday, Reliance Infrastructure's subsidiary Reliance Power Ltd (RPower) settled its loan obligation of ₹3,872.04 crore as a corporate guarantor for the debt of its former subsidiary Vidarbha Industries Power. Vidarbha Industries owns the 600MW thermal power plant in Butibori, Nagpur that Adani Group has been looking to acquire.