CCI approves subscription of Piramal debentures by Canadian investor

Fair trade regulator CCI on Tuesday said it has given nod to subscription of Piramal Enterprises' compulsory convertible debentures by Canadian institutional investor, Caisse de dpt et placement du Qubec (CDPQ).

The Competition Commission of India (CCI) in a tweet said it "approves subscription of CCDs of Piramal Enterprises by CDPQ. Upon conversion, equity shareholding of CDPQ in Piramal Enterprises will increase from 3.68 per cent to 8.99 per cent."

Piramal Enterprises in a regulatory filing in October said its board has approved raising of Rs 5,400 crore through a rights issue and preferential allotment of compulsory convertible debentures (CCDs).

"The rights issue of Rs 3,650 crore at Rs 1,300 per share, is intended to give an opportunity to all its existing shareholders to participate in the capital raise at an attractive price," Piramal Enterprises said in a filing to the BSE.

"In addition, the company plans to raise Rs 1,750 crore through the preferential allotment of CCDs at a conversion price of Rs 1,510 per share to Canadian institutional investor, Caisse de dpt et placement du Qubec (CDPQ)," Piramal Enterprises had said.

The preferential allotment will take place by November this year and the rights issue is expected to be completed by February 2020, it had added.

These funds will strengthen the company's balance sheet, insulate it against any external shocks and enable it to tap organic and inorganic opportunities arising out of market consolidation across our financial services, pharmaceuticals and information management businesses, Piramal Enterprises Chairman Ajay Piramal had said.

CDPQ has a long-standing partnership with Piramal Enterprises. It had participated as the anchor investor during its previous capital issuance, investing USD 175 million (around Rs 1,240 crore) out of the total issue size of USD 750 million, (over Rs 5,320 crore).