Mumbai: Raymond Realty’s board has approved raising up to about Rs 409 crore through a preferential issue of convertible warrants to promoter-group entity J K Investors (Bombay) Limited.
The company plans to issue 66,57,373 warrants at Rs 614 apiece, comprising a face value of Rs 10 and a premium of Rs 604. The warrants will be issued for cash through a private placement.
Shareholder Nod Required
The proposed allotment remains subject to approval from Raymond Realty’s shareholders, along with other statutory and regulatory clearances.
Each warrant will entitle J K Investors to subscribe to one fully paid-up equity share of the company at Rs 614. The allottee may exercise the conversion right in one or more tranches within 18 months from the date of allotment.
Any warrants left unconverted after the permitted period will lapse. The upfront amount paid for such warrants will also be forfeited, according to the company’s exchange filing.
Promoter Holding To Rise
J K Investors currently holds 1,98,61,793 shares in Raymond Realty, representing a 29.83 percent stake. Following full conversion of the proposed warrants, its holding is expected to increase to 2,65,19,166 shares, or 35.99 percent, on a fully diluted basis.
The transaction will therefore increase the promoter-group entity’s ownership while bringing fresh capital into the real estate company. Raymond Realty did not specify the proposed use of the funds in the disclosure.
Capital Base Expansion
To accommodate the warrant conversion, the board also approved an increase in the company’s authorised share capital from Rs 70 crore to Rs 75 crore.
The revised capital will comprise 7.5 crore equity shares of Rs 10 each, compared with 7 crore shares currently. This will involve creating an additional 50 lakh equity shares that will rank equally with the company’s existing shares in all respects.
The decisions were taken at Raymond Realty’s board meeting held on September 11. The meeting began at 4.30 pm and concluded at 4.45 pm, the filing said.
Disclaimer: This article is based on information disclosed by Raymond Realty in its exchange filing and is intended for informational purposes.
