Reliance Industries Fixes May 14 As Record Date For Rights Issue
Oil-to-telecom conglomerate Reliance Industries Ltd. has fixed May 14 as the record date to determine shareholders eligible to apply for India's biggest rights issue.
RIL had on April 30 announced its plan to raise 53,125 crore by way of a 1:15 rights issue—a first in nearly three decades. One share will be offered for every 15 shares held at Rs 1,257, a 14 percent discount to the closing price on April 30. RIL's share price has since risen to Rs 1,561.80, but the rights issue price remains the same.
"We inform you that the Rights Issue Committee constituted by the Board of Directors of the company has fixed Thursday, May 14, 2020, as the 'Record Date' for the purpose of determining the equity shareholders entitled to receive the rights entitlement in the rights issue," the firm said in a regulatory filing.
The rights issue opening and closing dates will be informed separately, it added.
Typically, cash-strapped companies use rights issues to raise money when they really need it. In such offerings, companies grant shareholders the right, but not the obligation, to buy new shares at a discount to the current trading price.
The last time RIL tapped the open market for funds was in 1991 when it had issued convertible debentures. The debentures were subsequently converted into equity shares worth Rs 55 apiece.