Kirloskar Ferrous Industries to issue warrants alongwith rights issue

Kirloskar Ferrous Industries Ltd the has announced that the Board of Directors of the Company at its meeting held on September 28, 2006, has approved the modification to the earlier resolution passed by them at their meeting held on May 24, 2006 for the issue of Equity share on rights basis to the existing equity shares holders for an aggregate amount of Rs 250 Crores.

Further the Board of Directors of the Company at the said meeting has approved the issue of equity shares along with detachable warrants on a rights’ basis to the existing shareholders of the Company. Further, the Board approved that the detachable warrants shall be convertible into equity shares after a period of 12 months but not exceeding 36 months from the date of allotment and the conversion shall be at a price, ratio and size as may be decided by the Board or Rights’ Issue cum Allotment Committee.

The Board of Directors have accorded their approval for the Rights shares issue proceeds to be utilized towards the following.

1. Redemption of preference shares;
2. Acquisition of capital goods;
3. Acquisition of Hot blast stoves
4. Acquisition of Moulding line
5. Acquisition of turbine driven blower; and
6. Acquisition of the Casting Division of Kirloskar Oil Engines Ltd.

and for any amendments / revisions / deletion as may be instructed by the regulatory authorities and as approved by the Board of Directors or the Rights’ Issue and Allotment Committee.

The proceeds on the conversion of warrants into equity shares shall be utilised for capitalizing on new opportunities that may arise from organic or inorganic means, including expansion of company facilities, acquisition, strategic partnership as may be decided by the Board or Rights issue cum Allotment committee thereof.

Rights’ Issue cum Allotment Committee has further been authorized to meet and decide on all other issues related to the proposed issue of equity shares together with detachable warrants on rights basis including but not limited to the finalisation of the documents to be filed with the statutory authorities and the acceptance and modification of the terms of the issue as may be necessary or as may be determined by the authorities from time to time.

Source : Equity Bulls

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