IFCI to fix bond/share conversion price on Dec 17

Industrial Finance Corporation of India (IFCI) today fixed December 17 as the relevant date for determining the price of shares to be issued upon conversion of bonds.

Bonds worth Rs 1,300 crore would be converted into equity at a price that would be determined as per Sebi guidelines.

The number of shares proposed to be issued on conversion would be determined after the relevant date, according to a release issued by IFCI to the BSE today.

The board of directors, last week, approved the proposal for the conversion of all optionally convertible bonds given to public sector banks into equity and retain the holding of state-run insurance companies at the present level of over 13%.

Public sector banks had agreed to convert their entire zero coupon rate optionally convertible bonds into equity. Life Insurance Corporation, GIC and associates agreed to convert that part of debentures into equity that would help them retain their holdings in IFCI.

Public sector banks, including State Bank of India, own 10.17% in IFCI. Conversion of the nearly Rs 900 crore debentures into equity would allow these banks to hold an additional stake of about 15% taking their combined ownership to over 25%.