News Brief
Reliance Industries To Give Preferential Treatment To Shareholders Lacking Fractional Entitlements In Rights Issue
Mukesh Ambani
Clarifying on its rights issue, Reliance Industries Limited (RIL) has said that shareholders whose fractional entitlements are being ignored will be given preferential consideration.
In a filing with the stock exchanges, RIL said that if the shareholding of any eligible equity shareholder is less than 15 equity shares or is not in the multiple of 15 equity shares, the fractional entitlement of such eligible equity shareholder shall be ignored for the computation of the rights entitlement.
However, the eligible equity shareholders whose fractional entitlements are being ignored, will be given preferential consideration for the allotment of 1 additional rights equity share each if they apply for additional rights equity shares over and above their rights entitlement.
However, this will be subject to availability of additional rights equity shares in this rights issue, the RIL said.
Since the ratio of rights issue is 1:15, some shareholders may be holding shares which are not in multiple of 15. Others may be having shares which are less than 15.
This fractional entitlement provision is meant for the benefit of such shareholders, clarifying what will be the arrangement for the subscription and allotment.
Shareholders can apply for 1 rights issue share for every 15 shares held. The record date is 114 May and the issue price is fixed at Rs 1,257 per rights equity share.
On application, the shareholders will pay Rs 2.50 on face value and Rs 311.75 on premium, totalling to Rs 314.25 per rights equity share.
The remaining Rs 942.75 will be payable in one or more subsequent calls as determined by the board of directors from time to time.
Reliance is gearing up for a Rs 53,125 crore rights issue on 14 May. The proposed rights issuance will be the first by RIL in three decades. The issue will be structured as partly paid shares and will enable shareholders to phase out the outlay on their investment over time.
As per the payment terms, 25 per cent of the amount will be on application and the balance on more calls.
With Inputs From IANS
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