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new Delhi: Reliance Industries Ltd The company said that on Wednesday it has completed the country’s largest rights issue of Rs 53,124 crore.
The world’s largest rights offering was oversubscribed 1.59 times in at least a decade by a non-financial company with a total commitment of over Rs 84,000 crore.
“The rights issue saw a huge investor interest, involving millions of small investors and thousands of institutional investors, both Indian and foreign,” the company said in a statement.
The public part of the rights issue was subscribed 1.22 times.
In the rights issue, the company is giving one share for every 15 shares held for Rs 1,257. RIL shares closed at Rs 1,542.45 on the BSE on Wednesday.
The rights issue committee of the company’s board of directors will meet on or about June 10 to approve the basis for the allocation of equity shares.
The firm said that the rights shares are expected to be listed on the BSE and NSE on June 12, 2020 under separate International Securities Identification Number (ISIN).
Commenting on the success of the rights issue, Mukesh Ambani, Chairman and Managing Director of Reliance Industries Limited stated that the issue is a new and proud milestone in the history of India’s capital market.
“Since the time of Reliance Industries Ltd. founder Dhirubhai Ambani, our shareholders have always been our biggest source of strength. Our decades-old relationship based on trust has continuously inspired us to achieve more. We are delighted with this extraordinary show and Are humble. Reliance’s future is trusted, “he said.
The success of RIL’s rights issue, seen in the context of prolonged nationwide lockout by the Kovid-19 epidemic, is a vote of confidence in Indian’s internal strength by both Indian domestic investors, foreign investors and small retail shareholders. Economy, he said.
“I have no doubt that the Indian economy will bounce back to follow the high growth trajectory in the world to come,” he said.
According to the issue offer document, the company will use three-fourths of the proceeds of its mega rights issue to repay some of its rights.
The company expects net income of Rs 53,036.13 crore from the issue after accounting for legal and other expenses.
The company had previously stated that shareholders would have to pay only 25 percent for subscribing to the company’s mega Rs 53,125 crore rights issue, and the remaining amount in two installments.
The last time RIL tapped Public for Fund was in 1991, when it issued convertible debentures. The debentures were later converted into equity shares in 55 shares.
Ambani unveiled a debt reduction plan by 2021 in August last year.
As part of the plan, RIL is seeking strategic partnerships in its businesses, aiming to remove the balance sheet.
At the end of the March quarter, RIL had outstanding debt of Rs 3,36,294 crore. It also had cash of Rs 1,75,259 crore, taking the net debt position to Rs 1,61,035 crore.
As a part of its balance sheet deleveraging schemes, Reliance has sold minority bets in its digital entity Jio Platforms to the likes of Facebook and private equity firms.
It is also in talks with Saudi Aramco to sell a fifth of its oil-to-chemicals business for a demand of $ 15 billion. It has sold half of its fuel retail venture to BP plc for Rs 7,000 crore and telecommunications tower business to Brookfield for Rs 25,200 crore.
The net debt of RIL will be reduced as a result of income from these transactions.
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