Aditya Birla Nuvo to raise Rs.780 Crores through Rights Issue

Aditya Birla Nuvo Ltd has announced that the Board of Directors of the Company at its meeting held on September 11, 2006, has decided to raise funds not exceeding Rs 780 crore through the issue of equity shares on a rights basis. The share ratio and price per share for the rights issue would be decided by the Board and announced at a later date, subject to necessary approvals.

The funds raised through the rights issue would be utilised for repayment of existing debt and general corporate purposes. It may be recalled that the Company has made substantial investments in Idea Cellular, TransWorks and Birla Sun Life Insurance besides its ongoing capital expenditure. The proposed capital issue will strengthen the capital structure of the Company.

Says Mr. Kumar Mangalam Birla, Chairman, of the Company, "Aditya Birla Nuvo stands at the threshold of its next phase of growth. The promoters are fully committed to this offer."

Avers Mr. Sanjeev Aga, Managing Director, of the Company,"The proposed rights offering will improve the gearing on the Balance Sheet, besides providing another opportunity to the existing shareholders to participate in the Company".

Enam Financial Consultants Pvt Ltd and DSP Merrill Lynch Ltd have been appointed as managers to the proposed issue and Amarchand & Mangaldas & Suresh A Shroff & Co. as legal advisors to the Company.

Source : Equity Bulls

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