Suzlon Energy Limited a manufacturer of wind turbines, is preparing for a Rs 1,200 rights issue that begins on October 11. This comes after the company’s founder and chairman Tulsi Tanti passed away unexpectedly.
Suzlon Energy announced on Monday that it would continue with its Rs 1,200 crore rights issue that would begin on October 11.
The company has notified the stock exchanges that its promoters have indicated again that they will be participating in the rights issuance.
The regulatory filing stated that “promoters and promoter group have reconfirmed their participation in the proposed rights issue and have expressed their intention to subscribe to the full extent of their rights entitlement” in response to the announcement dated October 2, 2022 (about the demise of Tanti).
In light of this, the business will stick to the proposed rights issuance timeline outlined in its letter of offer (LOF) dated September 28, 2022.
Himanshu Mody, the chief financial officer, spoke to Money control’s Rachita Prasad about how the company’s management, supported by the Tanti family, is making sure that business and the impending rights issue are not hampered. Mody responds to a few important queries before getting to the point.
This comes after Tulsi Tanti, the Suzlon Energy’s founder, chairman, and managing director passed away suddenly on Saturday following a cardiac arrest.
Mr. Tanti served as the company’s public face. Before other members of the organisation can take over, there will be a transitional period, according to Kejriwal Research founder Arun Kejriwal.
Although there had been highs and lows for the corporation in the past, he claimed that “today, one gets a feeling that the company was being reborn.”
Suzlon Energy Ltd. sells wind turbine generators and associated parts with a range of capacities. The company was founded by Tulsi Ranchhod Tanti on April 10, 1995, and it is based in Pune, India.S111, S128, and S120 wind turbine generators are among its offerings. The company conducts business through the following divisions: Foundry and Forging, Operation and Maintenance Services, and Other
The primary goal of the rights offering is essential to pay off the company’s existing debt. After the refinancing we completed in May 2022, the debt was significantly lowered to just about Rs 3,000 crore. To pay off the debt, we will use 900 crore rupees of the 1200 crore rupee rights issuance, which will make us considerably stronger with a leaner and meaner balance sheet. It will aid the business in moving past the ten-year period in which it struggled under a significant debt load.
The ex-rights trading day for Suzlon Energy’s rights issue, in which 5 shares are issued for every 21 that the shareholder owns, on Monday, 3rd of October.
The company announced last week that its board has decided to issue equity shares of the company through a rights issue to the company’s qualified equity shareholders.
According to a BSE filing by the company, 240 crore equity shares worth Rs 2 each will be issued, with an issue price of Rs 5 per equity share, for a total of Rs 1,200 crore in equity shares and rights.
The offer’s issue price is fixed at Rs 5, plus a premium of Rs 3 per equity share, a 43% reduction from the previous trading session’s closing price of Rs 8.7. When applying, Rs2.5 per equity share must be paid first, and the remaining Rs2.5 per equity share must be paid during the subsequent call (s).
Instead of going public, the company gets in touch with its current shareholders to raise fresh equity capital through a rights issue.
One of the main providers of renewable energy solutions in the country is Suzlon Energy. The market value of this small-cap firm is Rs 8,535 crore.
