The board of Kilburn Engineering Ltd has approved raising up to ₹300 crore by way of preferential allotment of shares and convertible warrants to the promoter and non-promoter groups to fund acquisitions and retire debt.
The company priced the issue at ₹425 a share, representing a 9.7 per cent discount to the closing price of ₹471.75 on Wednesday. The Kilburn stock has multiplied seven times in the last two years.
The share sale will have three components. The promoters, Amritanshu Khaitan and family, will bring in ₹63.76 crore in the form of warrants. The non-promoters, which include two foreign institutional investors and a clutch of HNIs, are going to bring in about ₹215 crore in a mix of equity shares and warrants.
Kilburn will also issue about ₹20 crore of shares as non-cash consideration for acquisition of Monga Strayfield Private Limited to the promoter group of the latter.
The promoter holding of the company may come down by 4 per cent following the share sale. The company is going to get ₹125 crore upfront from the share sale and 25 per cent by way of first call of payment from warrants. Each warrant will be converted to equity shares after 18 months.
Ranjit Lala, managing director, stated the strategic move would strengthen financial position and support growth initiatives.
Amritanshu Khaitan, director, added: “This capital will enable us to accelerate both organic and inorganic growth and move towards becoming debt-free.”