Aditya Birla Fashion and Retail Limited (ABFRL) has announced plans to raise $500 million through a mix of preferential issuance and Qualified Institutional Placement (QIP) of equity shares. This move aims to support the company’s retail expansion strategy in India and reduce its debt.
The company’s board approved a $275 million preferential issuance, with the promoter group contributing $150 million and Fidelity Investments committing $125 million. The promoter group’s investment comes at a 17.5 percent premium over the previous day's closing price, reflecting strong confidence in ABFRL’s future growth.
Fidelity Investments will participate in the preferential allotment through its funds, including Fidelity Blue Chip Growth Fund, Fidelity Blue Chip Growth Commingled Pool, Fidelity Blue Chip Growth K6 Fund, Fidelity Series Blue Chip Growth Fund, and FIAM Target Date Blue Chip Growth Commingled Pool.
Additionally, ABFRL’s board approved raising up to $225 million through QIP, bringing the total fundraising to $500 million. This capital infusion will help the company reduce leverage and drive its multi-channel growth strategy in India’s retail market.
The fundraising comes ahead of ABFRL’s planned vertical demerger into two separately listed entities, which is expected to be completed by the end of this financial year.
A shareholder meeting to approve the preferential issuance is scheduled for February 13, 2025, with the pricing reference date set for January 14, 2025. Both the preferential issuance and QIP will proceed following customary and regulatory approvals.
