Azim Premji, SBI MF invest Rs 350 cr in Tube Investments preferential issue

The money will be used to fund TII's organic and inorganic growth, including acquisition of CG Power and Industrial Solutions and TII's proposed capex

Tube Investments of India (TII), part of Rs 38,000 crore Murugappa Group, has said it has received Rs 350 crore from various investors including Azim Premji Trust, SBI Focused Equity Fund and SBI Magnum mid-cap fund, which have participated in the company's preferential issue.

The money will be utilised to fund TII's organic and inorganic growth  plans, including acquisition of CG Power and Industrial Solutions and proposed capex.

At the company's EGM on December 21, TII's shareholders approved the proposed issue and allotment of equity shares to the Subscribers, by means of a special resolution passed with requisite majority. 

In an announcement today, TII said that in receipt of an aggregate amount of around Rs 350 crore received from the Subscribers towards subscription to the Equity Shares, on the basis of which allotment of the 4,783,380 equity shares was made today.

The shares were alloted on a preferential/ private placement basis to non-promoter entities. Azim Premji Trust will be alloted 2,733,360 equity shares, each fully paid at Rs 731.70 and inclusive of a premium of Rs 730.70 per equity share. The total investment would be around Rs 200 crore.

The SBI-focused equity fund will be alloted 1,503,348 equity shares, each fully paid at Rs 731.70 and inclusive of a premium of Rs 730.70 per equity share, aggregating to Rs 109.99 crore. SBI Magnum mid-cap fund gets 546,672 shares, each fully paid at Rs 731.70 and inclusive of a premium of Rs 730.70 per share, aggregating to Rs 39.99 crore.

Azim Premji Trust will hold 1.42 pe cent, while SBI Focussed Equity Fund to 2.34 per cent from 1.60 per cent and SBI Magnum Midcap Fund's will hold 0.28 per cent. 

The fund raising will fund the company's organic and inorganic growth plans  including for part funding the proposed  acquisition of CG Power and Industrial Solutions Limited which is currently ongoing, for the Company’s capital expenditure; and for general corporate purpose.

TII has acquired a controlling interest in CG Power, which became a subsidiary of TII on November 26, 2020. TII’s aggregate shareholding (i.e. equity  shares and convertible warrants held by TII) in CG Power has risen from 56.61 per cent to 58.58 per cent of the company's share capital on a fully-diluted basis.