MUMBAI: The Board of Directors of Reliance Broadcast Network approved a proposal for new capital infusion of over Rs 4 billion (Rs 400 crore) into the company, by preferential issue of equity shares to the promoter group and other investors.
The new equity capital will substantially enhance RBNL’s net worth, and augment its borrowing capabilities, if required, thereby enabling greater participation in future growth opportunities, while enhancing overall shareholder value.
Reliance Broadcast Network Limited CEO Tarun Katial said, “The media and entertainment sector is back on an exciting double digit growth path. This resurgent market has brought with it changes in expectations from marketers and advertisers, as well as newer opportunities for media companies. The equity capital infusion is a reflection of the strong confidence of our promoter group in the future growth prospects of the company.”
The new capital infusion is proposed through a preferential offer of equity shares to the promoter group and other investors. The promoter group will subscribe to approximately 2.90 crore shares aggregating approximately Rs 2.50 billion (Rs 250 crore), and investors approximately 1.90 crore shares aggregating over Rs 1.50 billion (Rs 150 crore). The preferential offer, which is subject to necessary approvals, will be made at a price of Rs 85 per share, reflecting a premium of over 25% to the last 26 weeks average market price.
The proposed infusion of the new equity capital will see an increase of over 300% in shareholders funds from Rs 1.67 billion (Rs 167 crore) to Rs 5.68 billion (Rs 568 crore). It will also help RBNL participate in forthcoming growth opportunities in Phase III of radio bids and acquiring strategic inventory in the OOH space, etc.