Anil Ambani’s Reliance Infra to Raise $350M via FCCBs for Debt Clearance and Electric Power Push

Anil Ambani’s Reliance Infrastructure plans to raise $350 million (around ₹3,000 crore) through Foreign Currency Convertible Bonds (FCCBs). This money will be used to repay its rupee debt and invest in new businesses, such as generating electric power.

Debt Repayment and New Ventures

Reliance Infrastructure, involved in building roads, metro rail, and power generation, announced its plans to the stock exchange. The company has significant loans, including ₹2,253 crore from term loans and ₹703 crore from non-convertible debentures, according to a Care Rating report from February 26 this year.

The company also owes ₹1,505 crore to Yes Bank, which sold this loan to J.C. Flowers Asset Reconstruction Company. Other exposures include ₹600 crore from IDBI Bank, ₹82 crore from Jammu & Kashmir Bank, and ₹66 crore from Axis Bank, as per the same report.

Standstill Agreement with J.C. Flowers

Reliance Infrastructure had a standstill agreement with J.C. Flowers ARC, which was initially set to expire on March 20 but extended to May 30. This agreement meant that J.C. Flowers would not take legal action to recover its dues until after these dates.

Reliance Infrastructure disclosed it paid ₹1,347 crore to J.C. Flowers ARC, including ₹817 crore by March 31 and an additional ₹530 crore by the end of April 2024. The FCCB funds are expected to repay the remaining debt to J.C. Flowers ARC and other creditors.

New Subsidiaries and Future Plans

Last week, Reliance Infrastructure created four new subsidiaries:

• Reliance Jai Pvt Ltd (RJPL)
• Reliance Unlimit Pvt Ltd (RUPL)
• Reliance EV Pvt Ltd (REVPL)
• Reliance Risee Pvt Ltd (RRPL)

These companies will focus on electric power generation, IT consultancy, infrastructure, and making vehicles for fuel transport.

Previously, in August 2022, Reliance Infrastructure had planned to raise $400 million via FCCBs at ₹123 per share but did not proceed with the plan.

The new FCCB plan reflects the company’s ongoing efforts to manage debt and expand into new sectors.