Indiabulls Real Estate to raise Rs 3,911 crore through issuance of shares, warrants to investors

Indiabulls Real Estate on Friday said the board has approved raising Rs 3,911 crore through the issuance of shares and warrants to investors, including the Blackstone Group and the Embassy Group.

Global investment firm Blackstone will invest Rs 1,235 crore, while the Bengaluru-based Embassy Group will infuse Rs 1,160 crore.

After the conversion of the warrants, the Embassy Group will hold 18.7 per cent while Blackstone will hold 12.4 per cent.

In a regulatory filing, IBREL has informed that the board has approved “fund-raise via preferential issue of equity shares and convertible warrants, on a private placement basis, for cash consideration, aggregating to approx. Rs 3,910.93 crore”.

The move is aimed at recapitalising its balance sheet and positioning the company for organic and inorganic growth purposes.

These include capital expenditure for the completion of existing projects and new launches as well as proposed acquisitions, other working capital requirements and general corporate purposes.

The board has approved the issuance of 9,13,55,606 fully-paid equity shares of a face value Rs 2 each of the company at Rs 111.51.

It has also approved the issuance of 25,93,69,201 warrants, convertible into an equivalent number of equity shares, at an exercise price of Rs 111.51.

These securities would be issued to certain entities of the Embassy Group, Baillie Gifford, entities controlled by funds managed by affiliates of Blackstone Inc. (Blackstone Real Estate Fund), funds managed by Quant Money Managers, Poonawalla Finance and other financial investors.

The board’s approval is subject to the approval of the shareholders of the company and other requisite approvals.

In the filing, IBREL has said the board has approved asset acquisitions worth Rs 1,853 crore to re-energise the business and fuel growth.

Sachin Shah, executive director, IBREL, said, “We are excited to announce the recapitalisation of the company, which also includes four strategic asset acquisitions that boost our project pipeline.

“We are grateful for the constant support of our two largest shareholders. We are thrilled that we have a roster of new blue chip investors who have come on board and validated the company and its growth prospects. The funds will allow us to complete our existing projects and pursue new opportunities. This investment is a culmination of the turnaround strategy that has taken place over the past 13 months.”