Gensol Engineering announced plans to raise Rs 600 crore through the issuance of foreign currency convertible bonds and warrants on Thursday.
According to the company, at its meeting earlier today, the Board of Directors approved fundraising initiatives totaling Rs 600 crore with the aim of greatly enhancing the company's financial position.
The issuance of warrants to promoters will raise Rs 200 crore, while the issuance of Foreign Currency Convertible Bonds (FCCBs) will raise Rs 400 crore.
With Rs 1,146 crore in debt and Rs 589 crore in reserves, Gensol Engineering currently has a debt-to-equity ratio of 1.95. The company's reserves are anticipated to increase to about Rs 1,200 crore after the Rs 600 crore fundraise.
With Rs 615 crore in divestitures underway, the company's debt will be reduced to around Rs 530 crore.
Gensol Engineering Managing Director Anmol Singh Jaggi stated, "Our top priority is to strengthen Gensol's balance sheet, and we are taking bold and decisive steps to achieve that, beginning with this fund-raise."
This Rs 600 crore fundraise, along with the strategic divestments, will be critical in strengthening and positioning the company for long-term growth, he said.
In an additional filing, the business made it clear "that the issuance of promoter warrants is happening at Rs 56 per share of Re 1 face value, which is equivalent to Rs 560 per share of Rs 10 face value, considering the 10:1 stock split approved by the Board".
The business further disclosed that "at Rs 56 per Re 1 face value share, the pricing represents a 213 percent premium over the current market price of Rs 262 per share (Rs 10 face value adjusted)" .
