Reliance Infrastructure plans to raise Rs 60,000 crore from share sale

Mumbai: Anil Ambani-led Reliance Infrastructure Ltd on Thursday announced its plans to raise up to ₹6,014 crore, a day after the company entered into arbitration agreements with Adani Group over power distribution and with CFM Asset Reconstruction over a loan dispute.

In an evening press conference after the board meeting, Reliance Infrastructure said its board had approved a financing plan ₹3,014 crore in cash through preferential issue of up to 125.6 million ordinary shares or warrants convertible into an equal number of ordinary shares at a price of ₹240 yuan per share.

Reliance Infrastructure shares started to rise on Wednesday after news broke that the company had settled its dispute and claimed to be debt-free, closing at ₹284.75 per share on the Bombay Stock Exchange.

On Thursday, the company said its board of directors had also approved a financing plan to ₹30,000 crore through Qualified Institutional Placement (QIP).

To this end, the company will soon seek shareholder approval.

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Reliance Infrastructure is primarily engaged in the power distribution business in Delhi and provides EPC services. The company also operates certain projects in the defense sector through its special purpose vehicles and maintains infrastructure for certain metro services, toll roads and airports.

After a board meeting on Thursday, Reliance Infrastructure said it will use the proceeds from the proposed preferential issue to expand its business operations either directly or through investments in subsidiaries and joint ventures.

The funds may also be used to meet the company’s long-term working capital needs, the company said.

The company said the shares under the proposed preferential issue will be allotted to the promoter group company called Risee Infinity Pvt. Ltd, and several other investors, namely Florintree Innovation LLP and Fortune Financial & Equities Services Pvt. Ltd. The company also added that the preferential issue will increase the promoters’ actual holding in Reliance Infrastructure.

Also read | ₹3 trillion power distribution plan may be postponed

In addition, the preferential issue will enhance the net worth of Reliance Infrastructure. ₹9000 crores and above ₹12,000 crore,” the company said.

“The company has almost zero debt. The enhanced capital will support the company’s participation in high growth sectors to assist the government in achieving its vision of ‘Make in India’ and ‘Viksit Bharat’,” the company added.

On Wednesday, Reliance Infrastructure subsidiary Reliance Power Ltd (RPower) repaid ₹3,872.04 crore as a corporate guarantor for the debt of its former subsidiary, Vidarbha Industries Power. Vidarbha Industries owns the 600MW thermal power plant at Butibori in Nagpur, which the Adani Group had been looking to acquire.