Reliance Infrastructure's Rs 6,000 cr fundraising plan gets shareholders' nod

The preferential issue will enhance Reliance Infra’s net worth from Rs 9,000 crore to Rs 12,000 crore, with near-zero debt.

Shareholders of Reliance Infrastructure have approved the company’s plan to raise Rs 6,000 crore through a preferential issue of shares and the qualified institutional placement (QIP) route.

Both proposals received shareholder approval, with over 98 percent voting in favor of the resolutions via postal ballot, the company informed in a stock exchange disclosure. Reliance Infrastructure’s board, on September 19, approved the Rs 6,000-crore fundraising plan. Of this amount, Rs 3,014 crore will be raised through the preferential allotment of shares or convertible warrants, while Rs 3,000 crore will come from QIP.

In the first phase, Reliance Infrastructure is launching the Rs 3,014 crore preferential placement by issuing 12.56 crore equity shares or convertible warrants at an issue price of Rs 240 per share. Out of this, Rs 1,104 crore will be invested by the promoters of Reliance Infrastructure through promoter company Risee Infinity Private Ltd. Risee will subscribe to 4.60 crore shares. The two other investors participating in the preferential issue are Mumbai-based Fortune Financial & Equities Services and Florintree Innovations LLP. Florintree is owned by former Blackstone executive Mathew Cyriac, while Fortune Financial is owned by Nimish Shah.

Fortune Financial & Equities Services will invest Rs 1,058 crore by subscribing to 4.41 crore equity shares through the preferential allotment, while Florintree Innovations will invest Rs 852 crore, with an allotment of 3.55 crore shares.

The preferential issue will enhance Reliance Infra’s net worth from Rs 9,000 crore to Rs 12,000 crore, with near-zero debt. The proceeds from the preferential issue will be utilized for the expansion of business operations directly and/or through investment in subsidiaries and joint ventures, including meeting long-term working capital requirements and general corporate purposes.