Anil Agarwal-controlled mining conglomerate Vedanta has upsized its Qualified Institutional Placement (QIP) to $1.02 billion, according to Bloomberg News, offering 19.32 crore shares at a floor price of Rs 440 apiece.
The floor price of the share placement represents a 4.23% discount to closing price of July 15.
Vedanta’s shareholders had approved on June 21 the plan to raise up to Rs 8,500 crore through issuance of securities. This strategic move is part of Vedanta’s ongoing efforts to optimize its capital structure and enhance shareholder value, reinforcing the company’s commitment to financial growth and stability, the company added.
Citi, JM Financial and Nuvama Wealth are the bankers appointed for the QIP issue, CNBC-TV18 reported on July 11.
QIP is a method used by publicly traded companies in India to raise funds quickly by issuing shares or convertible securities to a select group of institutional investors such as mutual funds, venture capital funds, insurance companies, and foreign institutional investors.
It is an alternative to more traditional forms of capital raising, such as Initial Public Offerings (IPOs) and Follow-on Public Offerings (FPOs).
The move comes as Vedanta aims to reduce its standalone debt by $3 billion over the next three years. Vedanta reported a reduction in net debt to Rs 56,338 crore as of March 31, down Rs 6,155 crore from the preceding three months.
Last month, Vedanta subsidiary Finsider International accepted a proposal from one of its banks to sell 2.6 percent shareholding worth Rs 4,379.7 crore, in the mining conglomerate to a group of reputed institutional investors.
On July 16, shares of Vedanta ended lower by 0.8 percent at around Rs 456 on the NSE. The stock has gained nearly 80 percent in the year so far.
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