Textile major S Kumars Nationwide (SKNL) plans to raise Rs 1,000 crore through issue of shares on qualified institutional placement (QIP) basis to fund its expansion plans.
The company's board has approved raising an amount not exceeding Rs 1,000 crore through the issue of shares, SKNL said in a filing to the Bombay Stock Exchange.
The company would seek shareholders nod for the proposal.
"Currently, SKNL is looking at raising $70-80 million (Rs 335-382 crore) and half of this amount in next two-three months," SKNL Vice-Chairman and MD Nitin Kasliwal told news channel CNBC TV18 in an interview.
"The reason why we are doing this is because we are focused on our growth plan and we are going on a long-term strategy which is to maintain debt-equity ratio," he said, adding that the ratio is below 1:10 equity level.
Kasliwal said QIP is also intended to "take care of our strategy from a balance sheet perspective".
More From This Section
Kasliwal told the channel that the money raised through QIP will not be used for the acquisition of US-based bankrupt suit maker Hartmarx. S Kumars and British firm Emerisquethe acquired Hartmarx for about $120 million last.
"The Hartmarx acquisition is fully funded from internal accrual and debt in SKNL."
"This (QIP) is for furthering ongoing group plans, Basically, we are very bullish on the industry going forward in next five-seven years and we see lot of growth in the domestic (Indian) market as well...," Kasliwal told the channel.
"Hartmarx has 34 brands mainly catering to the US market and it (the deal) has very strong synergy for back-end and front-end operations from SKNL," Kasliwal said.
SKLN is also looking at increasing the global presence of Hartmarx after the buy-out, he added.