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The board of Reliance Industries Ltd, the oil to telecom conglomerate owned by billionaire Mukesh Ambani, will discuss a plan to float a rights issue at a meeting on Thursday, the company informed the Bombay Stock Exchange.
Reliance Industries did not offer details of the rights issue, including the end use of the proceeds.
The promoters hold slightly more than 50 per cent stake in the company, which runs the world’s biggest refining and petrochemicals complex at Jamnagar in Gujarat.
Back-up plan?
The oil industry has come under stress as demand collapsed in the wake of the nationwide lockdown restrictions imposed to slow the spread of the coronavirus, putting strain on a planned sale of a 20 per cent stake in Reliance Industries to Saudi Aramco, the world’s largest oil producer, for ₹1.03 lakh crore.
The stake sale is key to Ambani’s plan, which was announced at the company’s annual general meeting on August 12 last year, to cut the firm’s net debt to zero by March 2021. The stake sale was earlier expected to be closed by March 2020.
The rights issue could be a back-up plan to achieve the zero net-debt target, in case the Saudi Aramco deal face more delays.
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