The shares of Suzlon Energy Ltd tanked 6.04% and were trading at ₹ 8.50 apiece at 11:54 AM on Monday. This happened after the company’s board approved a rights issue at its meeting on Sunday. In addition, the company has allotted equity shares on the conversion of its bonds.
Suzlon energy is a small cap company with a market capitalization of ₹ 8,418 crores. The industrial firm is a leading provider of renewable energy solutions in India and has a presence in 17 countries across the globe.
Conversion of bonds
In accordance with the terms and conditions of the Bonds, Suzlon Energy has allotted 28,42,14,474 equity shares on conversion of 27,977 US$ denominated Convertible Bonds due 2032 (the Bonds) having a face value of US$ 320 each, which after capitalising interest @ 2.75% per annum accrued on half yearly basis on the Bonds is aggregating to US$ 9,455,285.
With this, the paid-up capital of the Company is ₹ 20,14,61,74,166 divided into 1007,30,87,083 equity shares of Rs.2/- each.
Rights issue
According to a regulatory filing, the company will raise ₹ 1200 crores through the issuance of ₹ 240 crore shares with the face value of ₹ 2 each at an issue price of ₹5 per share. This price is at a discount of 45% from the company’s market price of ₹ 9.10 on Friday’s closing bell. The share price of the company fell by more than 12% in the past two sessions.
Five equity shares will be issued for every 21 fully paid-up equity shares held by the eligible shareholders of the company. In other words, the ratio for the rights issue is 5:21. Assuming full subscription, the number of equity shares will increase from 1007,30,87,083 to 1247,30,87,083 after the issue.
In addition, if eligible shareholders hold five or more shares, such shareholders will be eligible for at least one equity share, it added.
Out of ₹ 5, the initial payment of ₹ 2.5 per equity share is due upon application, and the remaining ₹ 2.5 is due on subsequent call(s), The company said.
Written By Simran Bafna
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