Kolkata, Exide Industries Ltd announced on Tuesday its plans to raise Rs 150 crore through a 1:15 rights issue (that is one rights share for every 15 shares held). The issue is priced at Rs 30 per equity share of Re 1 face value.
According to a press release issued by the company, the board of directors of Exide approved the proposal at its meeting held here on Tuesday.
“The issue proceeds will be utilised in augmenting the long-term resources of the company,” the company said, adding that the equity capital of Exide would increase from the existing Rs 75 crore to Rs 80 crore after the rights issue.
Expanding capacity
Mr T.V. Ramanathan, Managing Director and CEO, added, “The enhanced capital will add more floating stock and therefore increase the liquidity of the scrip in the stock market.”
While the company did not give any detail of its fund requirements, it may be mentioned that Exide embarked upon a Rs 120 crore project in 2006 to double the capacity.
The project is scheduled to be completed in phases. Apart from enhancing the capacity of automotive batteries, the project includes setting up the second greenfield facility at Haldia in West Bengal for manufacturing industrial batteries. Apart from this, plans were announced recently about acquisition of 26 per cent stake in Ceil Motive Power Pty Ltd, an Australian traction battery marketing company and buy out of the residual stake in Exide’s subsidiary Caldyne Automatics. The total investments in these two projects may not exceed Rs 20 crore. Meanwhile, funds may also be required for equity infusion in ING Vysya Life. Exide has acquired 50 per cent interest in the insurance outfit in end 2005.
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