Mumbai, April 30 (IANS) The Board of Reliance Industries Ltd (RIL) on Thursday approved a Rights Issue of up to Rs 53,125 crore at Rs 1,257 per share.
In a regulatory filing, RIL said: “At its meeting held today, i.e., April 30, 2020 considered and approved, amongst others, the issuance of equity shares of Rs 10/- each of the Company on rights basis to eligible equity shareholders of the Company as on the record date (to be notified later), of an issue size of Rs.53,125 crore.”
The rights entitlement ratio would be 1 equity share for every 15 equity shares held by eligible shareholders as on the record date.
The proposed Rights Issuance will be the first by RIL in three decades. The issue will be structured as partly paid shares and will enable shareholders to phase out the outlay on their investment over a period of time.
On the terms of payment of issue price, the filing said that 25 per cent would have to be paid on application and balance in one or more calls as may be decided by the Board or the Committee of the Board from time to time.
The Board also constituted a ‘Rights Issue Committee’ to decide the other terms and conditions of the issue including the record date.
The promoter and promoter group of the company have confirmed they will subscribe to the full extent of their aggregate rights entitlement, it said, adding that they will also subscribe to all the unsubscribed shares in the issue.
“As new strategic investors look to partner and add-value to these growth engines, the rights issue enables all shareholder to participate in growth of Consumer/Technology business. The promoters have confirmed that in addition to subscribing to their aggregate entitlement in full, they will also subscribe to all the unsubscribed portion,” the company said in a statement.
According to analysts, the rights issue is a major development for RIL towards becoming a zero net debt company. S&P and Moody’s have both reaffirmed Reliance’s investment grade ratings.