Piramal Enterprises Ltd. plans to raise up to Rs 7,000 crore by selling shares to institutional buyers and through a rights issue to its promoter group.
The board approved selling nearly 4.64 lakh compulsorily convertible debentures at a face value of Rs 1.07 lakh each, according to a stock exchange filing. Each CCD will be converted into 40 equity shares after its 18-month maturity date, the filing added. The debentures carry a 7.8 percent interest rate and will be paid in half-yearly installments.
The board has also approved a Rs 2,000 crore rights issue at Rs 2,380 per share. Promoter Ajay Piramal, together with other promoters,will subscribe to the entire rights issue, said the filing.
BloombergQuint had earlier reported about Piramal's fundraising plans for its financial services business.
Investor appetite for the proposed debenture issue has been strong, one of the bankers involved in the transaction had told BloombergQuint on the condition of anonymity. The company has already received commitments of over $500 million from foreign institutional investors and overseas pension funds, he had said.
The board has also approved a proposal to merge Piramal Finance Ltd. and Piramal Capital Ltd. with Piramal Housing Finance Pvt. Ltd., the filing added.
Shares of Piramal Enterprises fell 0.2 percent ahead of the announcement, while the benchmark BSE Sensex ended trade 1.1 percent higher.