- Fidelity Investments to participate in USD 275 Mn preferential issue along with promoters.
- Promoter participation at ~18% premium to yesterday’s closing price
- Board also approves fund raise of USD 225 Mn through QIP
The Board of Aditya Birla Fashion and Retail Limited (ABFRL) has approved raising $500 million through a combination of preferential issuance and Qualified Institutional Placement (QIP) of equity shares.
As part of this initiative, a preferential issuance of $275 million will be led by the promoter group, contributing $150 million, and Fidelity Investments, contributing $125 million. The promoter group’s participation comes at a significant 17.5% premium to the previous day’s closing price, reflecting strong confidence in ABFRL’s growth and value-creation potential.
The preferential allotment by Fidelity Investments will be made through its funds, including:
- 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
Additionally, the Board approved a QIP issuance of up to $225 million, bringing the total equity raise to $500 million.
This capital infusion will help deleverage the company and enable it to aggressively pursue its growth strategy, leveraging multiple growth engines established in recent years.
The fundraise also marks a significant milestone ahead of the planned vertical demerger of the company into two separately listed entities. The demerger process is expected to be completed by the end of this financial year.
A shareholders’ meeting to approve the preferential issuance is scheduled for February 13, 2025, with the relevant date for pricing the issuance set as January 14, 2025.
Both the preferential issuance and QIP are subject to customary and regulatory approvals.
