Reliance Power’s board is expected to meet on Monday to consider raising long-term capital in the domestic and/or global markets. The development comes after group company Reliance Infrastructure announced plans to raise capital to the tune of Rs 6,000 crore.
The funds will be raised “by way of a preferred issue and/or issue of QIP and/or rights and/or convertible bonds in foreign currency”, according to a September 18 press release.
On September 18, Reliance Power announced that it has become a private credit company. On the same day, Reliance Infrastructure also announced that it has reduced its external debt from Rs 3,831 crore to Rs 475 crore. The next day, on September 19, Reliance Infrastructure’s board approved a plan to raise about Rs 6,000 crore.
UPDATE: Shares of Reliance Infra, Reliance Power soar as investors cheer debt settlement
In the first phase, the company is launching a special placement of shares worth Rs 3,014 crore, in which 12.56 crore equity shares or convertible warrants will be issued at an issue price of Rs 240 per share. Of this, Rs 1104 crore was invested by the promoters through the promoters’ company Risee Infinity.
Additionally, two Mumbai-based investment firms Fortune Financial and Flointree Innovation will invest Rs 1,910 crore in the company.
The special issue will boost Reliance Infra’s net worth from Rs 9,000 crore to Rs 12,000 crore with almost zero debt.
The proceeds of the special issue will be used to expand business activities.
Get all the latest stock market updates here. For all other news related to business, market, technology and automobiles, visit Zeebiz.com.
