Aditya Birla Fashion and Retail Limited (ABFRL) on Wednesday approved issuance of shares worth about Rs 2,379 crore on a preferential issue basis to promoters and qualified institutional buyers (QIBs).
After a board meeting to consider the fund-raising proposal, the Aditya Birla Group company said it had approved the issuance of up to 4,08,72,580 equity shares at an issue price of Rs 317.45 per share, for an aggregate consideration of up to Rs 1,297.5 crore to the promoter group.
After the completion of the fund-raising, the shareholding of Pilani Investment and Industries will increase to 3.9 per cent from 0.37 per cent currently.
The retailer has also approved equity fundraising of Rs 1,081.25 crore at a price of Rs 272.37 per share to QIBs. Fidelity Blue Chip Growth Fund, Fidelity Blue Chip Growth Commingled Pool, Fidelity Blue Chip Growth K6 Fund, Fidelity Series Blue Chip Growth Fund, and FIAM Target Date Blue Chip Growth Commingled Pool will participate in the round.
Following the announcement, shares of the company were trading around 0.43 per cent lower at Rs 269.20. The stock has underperformed benchmark indices and has given a return of less than 5 per cent in the last year.
The company had announced last year the demerger of its Madura business into a separately listed entity named ABLBL.
ABLBL will have its lifestyle brands business, including Louis Philippe, Van Heusen, Allen Solly, Peter England, Simon Carter, and youth western wear brands such as American Eagle & Forever 21.
It will also include the sportswear brand Reebok business, for which it has a long-term licensing agreement for the India market.
ABFRL will retain its retail business under Pantaloons and Style Up, along with a host of ethnic brands it owns, such as designer-led brands Sabyasachi, Shantanu & Nikhil, House of Masaba, and Tarun Tahiliani. It will also have premium ethnic wear brands from Jaypore, Tasva, and the TCNS portfolio.
