- PV Sindhu Enters Quarter-final of Hong Kong Open Super Series
- Padmavati cleared for Dec 1 release in Britain, SC allows advocate to file fresh plea
- Bharti family pledges Rs 7000 crore towards philanthropy
- Indian Navy gets its first woman pilot, 3 women NAI officers
- Colonel arrested for raping Lt- Colonel's daughter in Shimla
- Pradyuman murder case: Ashok was beaten, tortured and sedated to force his confession, claims wife
- Election Commission grants 'two leaves' symbol to unified AIADMK
Hathway to raise Rs 3 bn from two FIIs, plans to invest big in broadband
MUMBAI: Hathway Cable & Datacom has tapped two US-based foreign institutional investors (FIIs) to raise Rs 300.80 crore (Rs 3 billion), a bulk of which will be used for broadband expansion.
The multi-system operator (MSO), which has been on a fund raising spree, has got Smallcap World Fund Inc. and American Fund Insurance A/C of Global Small Capitalization Fund to subscribe to a preferential issue at Rs 320 per share.
The issue price is 6.5 per cent higher than Hathway’s closing share price of Rs 300.20 on Thursday, indicating the confidence that investors have in the MSO’s ability to grow the digital cable and broadband business.
Hathway’s valuation seems to be climbing. Late last year, the company had settled on a price of Rs 284 per share to allot on a preferential basis to Steadview Capital Mauritius, LTR Focus Fund and Massachusetts Institute of Technology SCM (MIT).
Outside this equity financing, Hathway has also taken an enabling resolution to raise debt to the tune of Rs 1,600 crore (Rs 16 billion). The company’s standalone entity has a debt of Rs 1,100 crore (Rs 11 billion). Thus, its borrowing limit has been hiked by another Rs 500 crore (Rs 5 billion)
“We have raised Rs 3 billion from two FIIs and have got quality investors on board. We will be mainly investing this in our broadband business. Though Phases III and IV are opening up, we will wait for government indications on the deadlines before aggressively investing on digitisation in these towns,” Hathway Cable & Datacom managing director & CEO Jagdish Kumar told TelevisionPost.com.
The two FIIs have subscribed for 9.40 million equity shares on a preferential basis. While Smallcap World Fund subscribed for 7.05 million shares, American Fund Insurance picked up 2.35 million shares.
The issue is subject to shareholders’ approval as well as other necessary approvals and compliance with applicable laws and regulation.
Following the issue, Hathway’s paid-up and subscribed equity share capital would increase to Rs 161.40 crore (Rs 1.61 billion).
In the recent past, Hathway had raised funds through preferential route. In September 2013, the company had raised Rs 99.99 crore (Rs 1.00 billion) by allotting equity shares to Steadview Capital Mauritius, LTR Focus Fund and Massachusetts Institute of Technology SCM (MIT). The company had issued 3.5 million shares of Rs 10 each at a price of Rs 284 per share.
Promoted by the Raheja Group, Hathway offers services such as cable TV, digital cable TV, broadband internet, channels and allied services. The company offers cable TV services across 125 cities and towns and high-speed cable broadband services across 18 cities. It distributes cable TV signals through fibre-optic networks belonging to Tata Power and Bharti.