The board of Kishore Biyani-led Future Retail has approved raising long-term funds up to $500 million in one or more tranches for acquiring in-store retail infrastructure assets. The proposal to acquire infrastructure assets was approved by the company's shareholders at their extraordinary general meeting (EGM) on November 08, 2019.
"The Board has reconsidered the various funding options for the acquisition of the retail infrastructure assets and found it more efficient to fund the same through the USD denominated borrowings," Future Retail told the bourses in a filing on Saturday.
Future Retail (FRL) further said that the board "approved raising of long term funds for the Company subject to the applicable regulatory approvals and market conditions, through the offer, issue and of allotment of senior, secured USD-denominated notes for an aggregate amount not exceeding $500 million to be issued in one or more tranches... to meet the capital expenditure for the acquisition of certain in-store infrastructure retail assets, in one or more tranches."
In its meeting, the Future Retail board also approved allotment of 2,48,00,000 equity shares of Rs 2 each to Future Coupons (FCPL), a promoter group entity, upon conversion of part of equity warrants against receipt of the balance of warrant issue price, that is, Rs 378.75 per warrant. On April 23, 2019, the Future Retail had allotted 396,03,960 equity warrants at Rs 505 per warrant to Future Coupons on preferential basis against receipt of 25 per cent of the warrant subscription price, that is Rs 126.25 per warrant.
"Henceforth, FCPL continues to hold balance 1,48,03,960 warrants, (on which 99.8 per cent of share warrant subscription amount has already been received by FRL) and which can be converted by warrant holder during the period of 18 months from the date of allotment of equity warrants (on or before October 22, 2020), in one or more tranches and on such other terms and conditions as applicable," the company said in its statement.
Post allotment of above equity shares, the paid-up equity share capital of the company will increase to Rs 105.47 crore divided into 52,73,98,439 equity shares of Rs 2 each, from Rs 100.51 crore divided into 50,25,98,439 equity shares of Rs 2 each, Future Retail further added.