New Delhi : Officials say that Anil Ambani's companies Reliance Infrastructure Ltd and Reliance Power Ltd are ready to implement their growth plans with Rs 17,600 crore funding and no debt. Over the last two weeks, both firms have disclosed plans to raise Rs 4,500 crore through preferential allotment of shares and Rs 7,100 crore from well-known global investment firm Varde Partners via equity-linked FCCBs with a 10-year maturity and a low 5 pc interest rate.
Reliance Power and Reliance Infrastructure plan to raise a total of Rs 6,000 crore through qualified institutional placement (QIP), with each company targeting Rs 3,000 crore. Officials stated that shareholder approvals are anticipated by the end of the month with resolutions established. A high-ranking member of the organization mentioned that the approach of Reliance Group to generate funds through equity or equity-linked long-term bonds will provide necessary growth capital for the group companies' expansion strategies. Despite maintaining a conservative debt-to-equity ratio of 70:30, securing more than Rs 17,000 crore through equity or equity-linked bonds will supply the group companies with a combined investment outlay of Rs 50,000 crore for their upcoming business strategies in the coming years.
The fundraising will also increase the total value of both companies to approximately Rs 25,000 crore. As per stock exchange filings, both firms are raising Rs 4,500 crore by issuing equity shares through preferential allocation. Out of the total amount, Rs 1,750 crore will come from the founders, and the rest of Rs 3,750 crore will be provided by four prominent investors - Fortune Financial & Equities Services, Florintree Innovations LLP, Authum Investment and Infrastructure, and Sanatan Financial Advisory. Furthermore, Varde Partners plans to invest Rs 7,100 crore utilizing equity-linked foreign currency convertible bonds (FCCB). These FCCBs with equity linkages have a lengthy 10-year maturity period.
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