Aditya Birla Fashion & Retail Ltd. plans to raise Rs 1,000 crore at the earliest via rights issue that will strengthen its balance sheet and provide further liquidity during the coronavirus caused COVID-19 pandemic, a company official said on Wednesday.
Aditya Birla Fashion & Retail is the country’s largest pure-play fashion and lifestyle player with a strong bouquet of fashion brands and retail formats with a network of over 3,040 stores, and presence across 25,000 multi-brand outlets across the country.
The board, which is meeting on Wednesday, is set to approve the plan to raise Rs 1,000 crore by way of a rights issue, which will be fully subscribed to by the promoters/promoter group, the official told PTI.
The management evaluated various options and is of the view that the rights issue will be an equitable mode of fund raising as it gives shareholders an opportunity to participate in the growth story, the official explained.
Soon, the board may constitute a committee to evaluate and finalise the timing and other details of the proposed issue.
The rights issue is part of their objectives of reducing leverage, strengthening balance sheet apart from funding general corporate expenses, including working capital.
The promoters and promoter group will be fully subscribing to their rights entitlement and will reserve their right to subscribe to any additional equity shares in the issue is under-subscribed.
The official further quoted as saying that the board intends to complete the issue at the earliest, subject to market conditions and other factors, including regulatory approvals.
Aditya Birla Fashion & Retail is a leading player in the apparel industry and with a large portfolio of strong brands.
Despite the market rallying over 3.25 per cent, the company counter closed in the red with a loss of Rs 0.46 per cent at Rs 107.85 on the BSE.