Reliance Infrastructure's plan to fund Rs 6,000 crore through qualified institutional placement (QIP) and preferential share issuance has been approved by the company's shareholders. According to a stock exchange report by the firm, both proposals have been approved by shareholders, with more than 98% of them voting in favor of the resolutions via postal ballot.
On September 19, the board of Reliance Infrastructure approved a plan to raise Rs 6,000 crore. Of this, Rs 3,000 crore will be raised through QIP, and Rs 3,014 crore was to be raised through convertible warrants or preferential share allocation.
By issuing 12.56 million equity shares or convertible warrants at an issue price of Rs 240 per share, Reliance Infrastructure will launch the Rs 3,014 crore preferential placement in the first phase.
The promoters of Reliance Infrastructure will allocate Rs 1,104 crore of this amount through their promoter business, Risee Infinity Private Ltd. Risee is going to subscribe to 4.60 crore shares.
Fortune Financial & Equities Services, based in Mumbai, and Florintree Innovations LLP are the other two investors taking part in the preferred issue. Nimish Shah owns Fortune Financial, while Mathew Cyriac, a former Blackstone executive, owns Florintree.
By subscribing 4.41 equity shares through preferential allotment, Fortune Financial & Equities Services would invest Rs 1,058 crore, and Florintree Innovations will contribute Rs 852 crore. 3.55 crore shares will be given to the company.
With almost no debt, the preferential offer will increase Reliance Infra's net worth from Rs 9,000 crore to Rs 12,000 crore.
The proceeds of the preferred offer would be used for general corporate objectives, long-term working capital requirements, and the direct and/or indirect expansion of business activities through investments in subsidiaries and joint ventures.
