Suzlon Energy Says Rights Issue To Aid Repayment Of Rs 584 Crore Debt

Suzlon Energy Ltd.'s rights issue, if fully subscribed, will help pare debt by Rs 583.5 crore, according to its chief financial officer.

The Rs 1,200-crore rights issue opened on Tuesday.

"Rs 583.5 -crore debt will be repaid with the assumption of full subscription of Rs 1,200 crore rights issue opened on Tuesday," Suzlon Group's CFO Himanshu Mody said in a virtual press conference. As on June 30, the wind turbine maker's total debt stood at Rs 3,200 crore, Mody said, exuding confidence that the company will be debt-free in eight years.

Suzlon will have a leaner, healthier and better balance sheet after the rights issue, Mody said, with no decline in promoter shareholding. Suzlon Energy had earlier this month said that its promoters had reconfirmed their participation in the rights issue, after the demise of founder Tulsi Tanti on Oct. 1.

According to the letter of offer, Suzlon Energy will issue up to 240 crore partly paid-up equity shares at Rs 5 apiece (including a premium of Rs 3 per rights equity share) aggregating to Rs 1,200 crore. The issue will be in the ratio of five rights equity shares for every 21 fully paid-up equity shares held by eligible shareholders on the record date of Oct. 4, 2022.

The last date for on-market renunciation of rights is Oct. 14, 2022.