Reliance Power to raise Rs 1,325 crore from Reliance Infra to trim debt
Reliance Power, which is part of Anil Ambani Group, plans to raise Rs 1,325 crore from its promoters to reduce debt. It will issue equity shares and convertible warrants to Reliance Infrastructure, which will see its stake in Reliance Power rise to 38 percent from the current 9 percent.
The boards of Reliance Power and Reliance Infrastructure approved the capital plan on Sunday. Reliance Power will issue 60 crore equity shares and 73 crore convertible warrants to Reliance Infrastructure at Rs 10 each, which is a discount to its last closing price of Rs 13 on Friday. The entire capital raised will be used to retire Reliance Power’s debt, which stands at Rs 25,000 crore.
A week ago, Reliance Infrastructure had announced plans to raise Rs 551 crore from its promoters and international private equity fund Varde Partners. Reliance Infrastructure’s stake in Reliance Power will increase to 25 percent after the equity share issuance and will further go up to 38 percent on conversion of warrants into equity.
Reliance Power’s board also approved two other fundraising proposals — issuance of foreign currency convertible bonds and issuance of equity shares with or without warrants via qualified institutions placement (QIP). The company has an operating portfolio of 5,945MW spread across thermal, gas and renewable energy.
"The Board of Directors of Reliance Power Limited at its meeting held today has approved preferential issue of up to 59.5 crore equity shares and up to 73 crore warrants convertible into equivalent number of equity shares of the company at an issue price of Rs 10 each by conversion of debt, aggregating up to Rs 1,325 crore to Reliance Infrastructure Limited, a listed promoter company," stated an official statement.