DLF QIP Issue Subscribed Two Times; To Raise Rs 3,200 Crore
The DLF Emporio shopping mall stands illuminated at night in New Delhi, India. (Photographer: Graham Crouch/Bloomberg)

DLF QIP Issue Subscribed Two Times; To Raise Rs 3,200 Crore

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DLF Ltd.'s qualified institutional placement issue has been subscribed over two times, enabling the company to raise around Rs 3,200 crore.

The country's largest real estate firm by market value launched its QIP on Monday, offering up to 17.3 crore shares to investors.

The offer has been subscribed at around Rs 183-184 per share, according to people in the know.

Major institutional investors who participated in the offer are Oppenheimer, UBS, HSBC, Marshall & Wace, Myriad, Key Square, Goldman Sachs, Indus, Eastbridge, Tata Mutual Fund and HDFC Mutual Fund, the people said.

The QIP issue will close on Friday with allotment of shares to institutional investors.

DLF had last year announced plans to issue shares through QIP to raise funds and pay loans to become debt-free.

The company launched its QIP on Monday at a floor price of Rs 193.01 per equity share but said it might offer a discount of up to 5 percent on the floor price.

This is the third major fundraising from DLF. In 2007, DLF raised about Rs 9,200 crore through an initial public offering. In 2013, the company had raised nearly Rs 1,900 crore through an institutional placement programme.

The DLF's QIP comes close in the heels of successful launch of India's first Real Estate Investment Trust, launched by Blackstone and Embassy Group, to raise Rs 4,750 crore.

DLF's group Chief Financial Officer Ashok Tyagi recently said the QIP proceeds and further infusion of Rs 2,500 crore from promoters against the issue of warrants would help the company significantly reduce the debt that stood at around Rs 7,200 crore as on December 31, 2018.

DLF Promoters KP Singh and family have already infused Rs 9,000 crore in the company and would pump in Rs 2,250 crore more.

The company made a preferential allotment of compulsorily convertible debentures and warrants to the promoters against the infusion of funds.

As infusion of the fund by promoters will lead to an increase in their shareholdings beyond the permissible limit of 75 percent, the company planned QIP to maintain minimum public shareholding of 25 percent in a listed entity.

In August 2017, the promoters had sold the entire 40 percent stake in rental arm DLF Cyber City Developers Ltd. for Rs 11,900 crore and infused the bulk of this amount in the company to cut net debt.

This deal included the sale of 33.34 percent stake in DCCDL to Singapore's sovereign wealth fund GIC for Rs 8,900 crore and buyback of the remaining shares worth Rs 3,000 crore by the rental arm.

The deal concluded in December 2017. As a result, DLF’s stake in DCCDL increased to 66.66 percent stake from 60 percent, while GIC has a balance of 33.34 percent stake in the joint venture firm.

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