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DEN looks to raise capital via equity route
MUMBAI: Sameer Manchanda-promoted DEN Networks is looking to raise capital via the equity route.
The multi-system operator (MSO) may require capital for broadband and digital cable TV expansion.
DEN Networks could look at raising up to Rs 500 crore (Rs 5 billion). The equity route will be explored at a favourable price. Debt also could be an option.
The company is keeping itself ready for raising capital. The board has given its nod for filing of application to the Foreign Investment Promotion Board (FIPB) for raising of capital through the primary market route as well. This would include issuance of long term securities like equity, quasi equity, GDR (global depository receipt), QIP (Qualified Institutional Placement), FCCB (foreign currency convertible bond), preferential allotment and bonds.
DEN Networks has already received permissions from the Ministry of Finance as well as the Reserve Bank of India (RBI) for increasing its foreign investment limit up to 74 per cent through secondary markets or open market purchases.
Now the company’s board has given its nod for filing an application to the FIPB for modification of the approval to include primary market route as well.
On 14 August, DEN got the FIPB nod to increase foreign investment limit beyond 49 per cent and up to 74 per cent by FIIs, NRIs, FPIs and other eligible foreign investors through the route of secondary market and open market purchase. The Reserve Bank of India also gave its nod for lifting the foreign holding in the company up to 74 per cent.
The FIPB nod through the primary market route would mean capital would come into the company. This would not have been possible through the secondary market route.