Lanco Infratech Ltd plans to secure shareholders approval to invest up to Rs 6,000 crore by way of securities into its subsidiaries/special purpose vehicles, to enable them to meet the capital commitment of projects.
The diversified infrastructure company plans to seek approval from shareholders for an enabling resolution during the annual general meeting slated for September 28.
As per the provisions of the new Companies Act, any new capital investment needs shareholders approval. Even though these are ongoing projects, and investments have been made in the past, for new investments, approval is necessary as per the Act. Therefore, the company would seek their nod during the AGM, a senior official of the company said.
According to the notice filed with the stock exchanges, the shareholders approval is aimed at meeting the future capital requirements of various company subsidiaries and special purpose vehicles executing projects which are now at various stages of implementation.
With the enabling resolution, the company board would be authorised to invest or even acquire the securities of any other body corporate including its subsidiary company or companies by way of subscription /purchase or otherwise.
As of March 31, 2015, the company had invested in securities of other companies amounting to Rs 10,959.25 crore, which includes investments in wholly-owned subsidiaries/subsidiaries and associated companies.
In order to meet the future capital requirements of the company into various companies, the company is now seeking approval for an investment of Rs 6,000 crore by way of securities in addition to the existing investments. The company has more than 30 subsidiaries, each executing one project.
By way of another resolution during the AGM, the Lanco Group promoters would also seek members' nod for conversion of debt into equity. The promoters had invested about Rs 167 crore before the Master Restructure Agreement with the lenders. It was later decided that this loan would be converted into equity.