Aditya Birla Fashion to raise $500m via QIP, preferential issue
Aditya Birla Fashion and Retail (ABFRL) on Wednesday said its board has approved raising $500 million (about ₹4,320 crore) through a mix of preferential issuance and Qualified Institutional Placement (QIP) to reduce debt and accelerate its growth plans.
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The retailer of brands like Louis Philippe and Pantaloon said it will raise $275 million, split between the promoter Aditya Birla Group investing $150 million and global investor Fidelity buying shares worth $125 million. The remaining $225 million will be through a qualified institutional placement.
Fidelity will buy the shares at ₹272.37 apiece while Birla group entities will pay ₹317.45 per share, a 17.5% premium to the stock's closing price on Tuesday, signalling conviction in the value creation potential of ABFRL, the company said in a regulatory filing.
«This combined fundraise will deleverage the company and position it to aggressively pursue its growth strategy through its multiple growth engines established over the last few years,» it said. «This capital raise marks an important milestone ahead of the proposed vertical demerger of the company into two separately listed entities.»
On Wednesday, ABFRL stock fell 1.7% to close at ₹265.6 apiece on the BSE. The Birla family's stake in ABFRL will increase to
