Reliance Communications (RCom), the country’s fourth-largest telecom operator, has raised $800 million (Rs 4,800 crore) from its stake sale to institutional investors. The company, together with a Rs 1,300-crore share sale to promoters, will raise a total of Rs 6,100 crore.
The funds raised through the institutional stake sale or Qualified Institutional Placement (QIP) was 60 per cent higher from the originally proposed Rs 3,000 crore. The company received total bids worth Rs 12,000 crore, mainly from US funds with a long-term investment view, sources close to the development said.
The demand also came in from funds in Singapore and Hong Kong. The company, which closed the QIP issue, has decided to retain Rs 4,800 crore, sources said, declining to be identified before a formal announcement.
When contacted an RCom spokesperson declined to comment.
RCom, controlled by billionaire Anil Ambani, will net an additional Rs 1,300 crore through a preferential issue of warrants to promoters. The company’s total equity proceeds (from QIP and preferential issue) would be about Rs 6,100 crore.
The company had hired Edelweiss Financial Services and Axis Capital to manage the QIP.
The QIP was priced at ₹142.13 a share and the stake sale to promoters at ₹150 a share.
RCom will use the proceeds to pare high-cost rupee debt, which will help it make interest savings of more than Rs 800 crore per year, sources said. The company, which earlier made many attempts to reduce liability by offloading stake in subsidiaries and raising funds, had a debt of $6.8 billion as of March 31.
RCom shares closed up 0.03 per cent at Rs 151.40 apiece on a weak BSE, which closed down 0.22 per cent.