Reliance Infrastructure Secures Rs 1,100 Crore Equity Infusion from Promoters
Reliance Infrastructure Ltd., led by Anil Ambani, announced a significant financial boost. The company is set to receive an equity infusion of Rs 1,100 crore from its promoters. This move comes as part of a larger fundraising strategy that aims to enhance the company’s financial standing and operational capabilities.
The infusion of Rs 1,100 crore will be executed through the promoter company Risee Infinity Private Limited. This company will subscribe to approximately 4.60 crore shares at an issue price of Rs 240 per share. This investment is part of a broader plan approved by the board to raise a total of Rs 6,000 crore. Out of this total, Rs 3,014 crore will be raised through a preferential allotment of shares, while the remaining Rs 3,000 crore will come from an issue to institutional buyers.
In addition to the promoter infusion, Reliance Infrastructure is also set to receive Rs 1,910 crore from two prominent Mumbai-based investors: Fortune Financial & Equities Services and Florintree Innovations LLP. Fortune Financial will invest Rs 1,058 crore by subscribing to around 4.41 crore shares. Meanwhile, Florintree Innovations will contribute Rs 852 crore for about 3.55 crore shares. Florintree is notably owned by Mathew Cyriac, a former executive at Blackstone, while Fortune Financial is led by Nimish Shah.
The preferential issue aims to significantly boost Reliance Infra’s net worth from Rs 9,000 crore to approximately Rs 12,000 crore. This financial maneuver is particularly noteworthy as it positions the company with near-zero debt levels. Such a robust financial foundation is expected to support the company’s growth and expansion plans in various sectors.
The company has initiated a postal ballot seeking approval from shareholders for this preferential allotment. E-voting commenced on September 20 and will conclude on October 19. The results of this ballot are scheduled to be announced on October 21. This democratic approach ensures that shareholders have a say in significant financial decisions impacting the company’s future.
The proceeds from this preferential issue are earmarked for multiple purposes. They will primarily be used for expanding business operations directly or through investments in subsidiaries and joint ventures. Additionally, these funds will help meet long-term working capital requirements and cover general corporate expenses.
Promoters currently hold a substantial stake in Reliance Infrastructure, amounting to about 21.34%. This equity infusion reflects their confidence in the company’s potential and their commitment to its future growth.
In summary, Reliance Infrastructure’s strategic move to secure Rs 1,100 crore from its promoters and additional investments from other financial entities marks a pivotal moment for the company. With plans for expansion and a strong financial backing, Reliance Infra is poised for significant developments in the coming months.
