Black Box promoters to raise Rs 410 cr via preferential issue of warrants

When warrants are converted into equity, promoter shareholding will decrease marginally

The Ruia family, promoters of Black Box, will invest Rs 410 crore via a preferential issue in the global digital infrastructure firm, according to a company statement.

The BSE-listed firm will utilise the funds for expansion in the digital infrastructure sector.

Black Box's board, in a meeting on Friday, approved issuing up to 9,832,123 fully convertible warrants, priced at Rs 417 each, aggregating to Rs 410 crore. Each warrant is convertible into one equity share of face value Rs 2 at a premium of Rs 415, in one or more tranches, within 18 months from the date of allotment.

The funding round includes Rs 200 crore from existing promoters, reflecting continued confidence in the business and its growth plans, Rs 200 crore from a consortium of marquee investors, including foreign institutional investors and high-net-worth individuals, and Rs 10 crore from key management personnel of the company.

Post conversion of the warrants into equity, the promoter shareholding will decrease marginally from the existing 71.1 per cent to 69.8 per cent.

“We are thrilled to have secured this capital, which will enable us to embark on an ambitious growth trajectory, enhance our digital infrastructure offerings, and drive innovation in a rapidly evolving market,” said Sanjeev Verma, chief executive officer of Black Box.

The capital raised will be invested in expanding data centre build capabilities, which are expected to grow exponentially over the next 3-5 years, driven by the adoption of Cloud and artificial intelligence (AI).

Black Box, which already has a strong presence in the two technologies, will invest in the value chain to become a dominant player, providing expanded services to hyperscalers, multi-tenant data centre operators, and large enterprise data centres.

The firm will also deploy capital to expand its solutions portfolio for enterprise customers and data centre operators, including hyperscalers, in the areas of connectivity infrastructure and networking, which are critical to supporting increasing data traffic and demands for better user experiences at the edge.

“A portion of the funds will be allocated to innovation and development efforts aimed at pioneering new digital infrastructure solutions, including advancements in cloud computing infrastructure, cybersecurity, artificial intelligence, and the Internet of Things (IoT),” said the statement.

The investment will support the company’s strategic expansion and growth initiatives into key industry verticals, with relevant technology solutions, including key leadership hiring and significantly expanding its sales and business development efforts in North America and emerging markets.