Aditya Birla Fashion to raise Rs 4,789 cr through preferential issue, QIPs

New Delhi, Jan 15 (PTI) Aditya Birla Fashion and Retail Ltd (ABFRL) on Wednesday announced to raise Rs 4,789 crore through preferential issuance to promoters and a qualified institutional placement (QIP) route, which will help it pursue its growth strategy.

The board of the Aditya Birla group firm, in a meeting held on Wednesday, passed a resolution to raise Rs 2,378.75 crore, which includes Rs 1,297.50 crore from issuing equity Shares to a promoter entity Pilani Investment and Industries Corporation and Rs 1,081.25 from Fidelity Investments.

The ABFRL board has also approved the convening of an extraordinary general meeting on February 13, 2025, to approve the fundraising of 2,378.75 crore.

Besides, the board "approved the issuance of equity shares by way of QIP, for an aggregate amount not exceeding Rs 2,500 crore", the company said.

This is in furtherance to an earlier approval granted by the shareholders of the company at the annual general meeting of ABFRL held on September 19, 2024.

"The board of ABFRL in its meeting today approved raising of USD 500 million (over Rs 4,320.44 crore) through a combination of preferential issuance and QIP of equity shares," the company said in a statement.

This combined fundraising will deleverage to "aggressively pursue its growth strategy" through its multiple growth engines established over the last few years, it added.

According to the company, this capital raise marks an important milestone ahead of the proposed vertical demerger of the company into two separately listed entities.

The company is demerging Madura Fashion & Lifestyle (MFL) business from ABFRL into a newly incorporated firm Aditya Birla Lifestyle Brands Ltd (ABLBL), and expects this process to be completed by the end of this financial year.

As per the proposal, ABFRL will issue up to 4.08 crore shares of face value of Rs 10 each at issue price of Rs 317.45, aggregating Rs 1,297.50 crore to Pilani Investment and Industries Corporation, a promoter group entity.

It will also issue "up to 3.96 crore equity shares of face value of Rs 10 each at issue price of Rs 272.37" to qualified institutional buyers.

These shares are with a premium of Rs 262.37 and will aggregate to an amount up to Rs 1,081.25 crore.

"The preferential allotment will be subscribed by Fidelity Investments through its funds viz Fidelity Blue Chip Growth Fund, Fidelity Blue Chip Growth Commingled Pool, Fidelity Blue Chip Growth K6 Fund, Fidelity Series Blue Chip Growth Fund & FIAM Target Date Blue Chip Growth Commingled Pool," it said.

Shares of ABFRL on Wednesday settled at Rs 265.60 apiece, down 1.76 per cent from the previous close on BSE. PTI KRH KRH BAL BAL