Reliance to pump another Rs15,000 cr in Jio via rights issue

Reliance Jio Infocomm Ltd on Monday said its parent Reliance Industries Ltd will invest Rs15,000 crore more in the company through an issue of non-cumulative optionally convertible preference shares.

This issue substitutes a rights issue for the same amount that the company had approved in July.

''The board of directors at its meeting held on September 12, 2016 has decided to make rights issue of 300 crore 9% non-cumulative optionally convertible preference shares (OCPS) of Rs10 each for cash, at a premium of Rs40 per OCPS, aggregating to Rs15,000 crore,'' the company said.

Each OCPS shall be either redeemed at a value of Rs50 per OCPS or converted into five equity shares of Rs10 each at any time at the option of the company, but not later than 10 years from the date of allotment of OCPS.

The board of Reliance Jio had, on 14 July, approved the issue of 15 billion equity shares of Rs10 each, aggregating to Rs15,000 crore. Jio didn't provide a reason for changing the instrument of raising funds

For Reliance Jio, the preference share issue will be second such fund-raising exercise this year, after having announced a Rs15,000 crore rights issue to its parent in January.

Jio, which launched operations commercially on 5 September, faces spectrum auctions in October, where it is likely to beef up its 4G airwave holdings.