India's largest steel maker, SAIL today said it plans to raise up to Rs 5,000 crore via private placement and the proceeds will be utilised for modernisation programmes, among others.
The state-run firm will seeks shareholders' nod for a special resolution at its annual general meeting next month, it said in a regulatory filing.
SAIL will approach shareholders to allow its Board to make offer "to raise funds through private placement of Secured Non-convertible Debentures/Bonds of up to Rs 5,000 crore, during a period of one year from the date of this AGM...," the filing added.
Besides eligible investors, the firm will approach NRIs, FIIs, Venture Capital Funds, Foreign Venture Capital Investors, State Industrial Developments Corporations, Insurance Companies, Provident Funds, Pension Funds, Development Financial Institutions, among others.
Explaining the rationale, SAIL said: "The company has already spent about Rs 62,441 crore on expansion programme till April 30, 2016. In order to part finance the expansion programme, your company plans to borrow about Rs 5,000 crore during the next year."
On analysis of the various options of raising funds through borrowing in domestic and international market, it has been decided by the Board to raise the funds through private placement of Secured Nonconvertible Debentures/Bonds to the extent of Rs 5,000 crore during the year, it added.
The Maharatna firm is in process of enhancing hot metal production capacity to 23.46 MTPA and crude steel to 21.04 MTPA under its expansion and modernisation programme, which is expected to be completed by 2016-17 fiscal.
Disclaimer: No Business Standard Journalist was involved in creation of this content
