Gujarat NRE Coke group to launch Aussie arm's follow-on issue

The Gujarat NRE Coke group’s Australian subsidiary, Gujarat NRE Minerals, will have a follow-on public offer (FPO) in a bid to take the company’s public holding to 25 per cent.

Speaking on the sidelines of the Gujarat NRE Coke’s annual general meeting, Vice-Chairman and Managing Director of the group Arun Jagatramka said the current public holding in their Australian arm was 15 per cent and the intention was to take it to 25 per cent.

However, the timing of the issue would depend on market conditions, which were not conducive for an offer at the moment, he said.

However, the turmoil in the financial market would not hit the company’s expansion plans, though it might affect the outlook, Jagatramka added. Pointing out that the company’s debt-equity ratio was 0.5:1, Jagatramka said that there was no immediate need for taking debt.

According to him, coking coal contracts, which were sealed this year at $300 per tonne, were expected to increase to $340-350 per tonne next year.

As of now, there was no change in the outlook for coking coal prices, he said.

Further, Gujarat NRE Coke would raise around Rs 120 crore from a differential voting rights issue.

Jagatramka said the issue would take promoters’ voting rights in the company from 41 per cent to 51 per cent.

The DVR shares to the existing shareholders on rights basis would be in the ratio of 1DVR share per 450 existing equity shares at the price of Rs 1,000 per share.