Arvind Fashions to garner nearly Rs 400 cr through a rights issue

Board of Directors of the branded apparel and retail company of the Arvind Group, Arvind Fashions Limited on Sunday approved re-launch of its rights issue with a revised issue size of up to Rs 399.79 crore.

Deferred earlier due to the lockdown and overall market conditions on account of the Covid-19 pandemic, the board approved the issue with a revised issue price and entitlement ratio. The issue will open on June 29 and close on July 17, 2020.

The board has approved the rights issue of up to 3,99,79,347 equity shares of face value of Rs 4 each at an issue price of Rs 100 per equity share, including a premium of Rs 96 per rights equity share aggregating up to Rs 399.79 crore as against the previous size of Rs 299.64 crore to all the existing equity shareholders of the company on the record date of March 18, 2020.

According to Kulin Lalbhai, director of Arvind Fashions Ltd, the infusion of about Rs 399.79 crore through the rights issue will help the company "stabilise its operations and cash flow".

"With the opening up of the economy, our offline and online sales are seeing a growth momentum," Lalbhai said in an official communique.

The promoters will be fully subscribing to their rights entitlement and will reserve their right to subscribe to any additional equity shares if the issue is under-subscribed, subject to applicable laws.

Meanwhile, the board has also revised the issue price from Rs 150 per equity share to Rs 100 per equity share, including a premium of Rs 96 per equity share and consequently, revised rights entitlement ratio of 62 rights equity shares for every 91 equity shares of the company held by eligible equity shareholders as on the record date of March 18, 2020.