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RCom raises Rs.4,800 cr through QIP issue

Special Correspondent
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Reliance Communications (RCom) has raised Rs.4,800 crore from a share sale to institutional investors to pare debt. The decision to sell shares through this route was announced on Tuesday.

According to officials involved in this exercise, this is the biggest qualified institutional placement {(QIP fund-raising by a private firm. The previous biggest private sector QIPs in India were from Adani Group (Rs.4,000 crore) and GMR (Rs 3,966 crore)}.After the QIP, the promoter shareholding in RCom will drop to 60 per cent from 67 per cent.

RCom will also raise Rs.1,300 crore by issuing warrants to its promoters. The promoters will pay 5 per cent premium to QIP offering.

Thus, RCom will raise a total of Rs.6,100 crore through the fund raising exercise.

The company opened the QIP on Tuesday at a price of Rs.142.13 a share and received total bids of more than Rs.12,000 crore and with encouraging response it raised the allotment price to Rs.146 per share, officials said adding that the company decided to retain Rs.4,800 crore as compared to earlier plan of Rs.3,000 crore.

According to officials, U.S. funds snapped up major portion of offering.

Over 80 per cent of QIP contribution was from overseas blue chip investors, officials involved with the process added.

Proceeds of QIP will be used to repay high cost rupee debt.

RCom shares closed at Rs.151.40, up 0.03 per cent on the BSE.

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