The equity issuance will take RInfra and other promoter holding in RPower to up to 25%, and will further increase it beyond 38% on conversion of warrants, RPower said.
Reliance Power (RPower) board of directors has on Sunday approved preferential allottment of shares and convertible warrants to Reliance Infrastructure (RInfra) by conversion of outstanding debt of Rs 1,325 crore into equity. The equity issuance will take RInfra and other promoter holding in RPower to up to 25%, and will further increase it beyond 38% on conversion of warrants, RPower said.
“Along with the planned debt reduction in subsidiaries, RPower’s consolidated debt will reduce by Rs 3,200 crore in FY22,” RPower said in a statement. The debt equity ratio is expected to improve to 1.80 :1 times in FY22 from 2.08 times in FY21, the company said.
The board has also approved seeking enabiling resolution to raise funds through foreign currency convertible bonds (FCCBs), and securities through qualified institutional placements (QIPs).
Reliance Power had defaulted on repayments to Axis Bank, Yes Bank and Lakshmi Vilas Bank (LVB) due on January 31, 2020. The company defaulted on repaying Rs 78 lakh to Axis Bank, Rs 1.09 crore to Yes Bank and Rs 1.25 crore to LVB. The firm had taken a loan of Rs 75 crore from Axis Bank, Rs 63 crore from Yes Bank and Rs 20 crore from LVB.