3 Shriram Group Firms To Float Rs 47.5-crore Rights Issue In April

Chennai, January 20: | Updated: Jan 21 2003, 05:30am hrs
Three Shriram group companies are planning to raise about Rs 47.5 crore through rights issues during April this year to provide funds for their growth plans. The rights shares will be priced at par at Rs 10 per share.

Shriram Investments Ltd (SIL) will raise Rs 19 crore, Shriram Transport Finance Company Ltd (STFCL) will raise Rs 21 crore and Shriram City Union Finance Ltd (SCUFL) nearly Rs 7.5 crore. Shareholders of SIL and STFCL will get one share for every two shares held (1:2), while shareholders of SCUFL will get one share for every share held (1:1).

The boards of all the three companies have approved the proposal in a meeting held on Monday. The board has approved the proposal. We are hopeful of coming out with the issue by mid-April.

We expect huge increase in our business and the funds raised through the issue will help us conform to the capital adequacy requirements as well, STFCL managing director R Sridhar said. Citicorp Finance (India) Ltd, the non-banking finance arm of Citibank, had recently picked up 14.9 per cent stake each in SIL and STFCL.

When asked whether Citicorp will subscribe to the rights issue, Mr Sridhar said, It is a little premature to comment. However, since they are the shareholders of the company they might subscribe to the rights issue.