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Reliance Power approves issue of shares to RInfra, to reduce debt by $13.25 bn
Reliance Power's board approved the move in a meeting on Sunday. After the deal is executed, Reliance Infrastructure's holding in RPower will increase to 25 per cent.
Anil Ambani-led Reliance Power (RPower) on Sunday approved a preferential issue of 59.5 crore equity shares and 73 crore warrants worth $13.25 billion ( ₹1,325 crore) to its promoter firm Reliance Infrastructure. The move will help RPower's standalone debt by ₹1,325 crore, and cumulatively by $32 billion ( ₹3,200 crore) in the current financial year, the company said in a filing before the Bombay Stock Exchange (BSE).
The move was approved by Reliance Power's board in a meeting on Sunday, the company said in the filing.
The issue price for 59.5 crore equity shares and up to 73 crore warrants has been kept at ₹10 each by conversion of debt to listed promoter firm Reliance Infrastructure Ltd, RPower said.
After the deal is executed, Reliance Infrastructure's holding in RPower will increase to 25 per cent, and post conversion of warrants will go up to 38 per cent. The move will benefit eight lakh shareholders of Reliance Infrastructure.
Reliance Power's board also approved seeking enabling authorisations of members for issuance of foreign currency convertible bonds; and securities through qualified institutions placement, Reliance Power said in its filing.
"The board of directors of Reliance Infrastructure Ltd...approved the subscription of preferential issue of up to 59.5 crore equity shares and up to 73 crore warrants convertible into equivalent number of equity shares of Reliance Power Ltd, by conversion of outstanding debt including interest aggregating up to ₹1,325 crore," the company said in a filing.
The proposals shall be subject to all requisite permissions, sanctions and approvals as may be necessary, it added.
On June 6, Reliance Infrastructure's board had approved raising up to ₹550.56 crore through issuance of shares on a preferential basis.
The funds raised would be utilised for long-term resources for general corporate purposes, to fund future growth and also to reduce debt, the company had said in a statement.
