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Siti Networks plans to raise $100 mn

MUMBAI: Siti Networks Ltd (earlier known as Siti Cable Network) is planning to raise up to $100 million (Rs 670 crore) from the market through issuance of securities.

The board of the Essel Group-owned cable TV company has given in-principle approval to raise the funds for operations of the company through equity or equity-related instruments.

siti-networks-techThe funds will be raised either through qualified institutional placement (QIP), external commercial borrowings (ECBs) with right of conversion into equity shares, foreign currency convertible bonds (FCCBs), American depository receipts (ADRs) or global depository receipts (GDRs).

“This is an enabling clause. Last year, this approval was also taken. Since a year has lapsed, fresh approval was needed from the company’s board,” an industry source said.

In February 2016, the promoters of Siti Networks had pumped in Rs 530 crore (Rs 5.3 billion) into the company to fund the company’s expansion. This was the first tranche of a total capital infusion plan of Rs 680 crore (Rs 6.8 billion) committed by the promoters. So Siti can still receive a fresh capital infusion of Rs 150 crore (Rs 1.5 billion).

In FY15, Siti Cable had raised Rs 221.11 crore (Rs 2.21 billion) by issuing 63.17 million shares via qualified institutional investors. Additionally, 5.71 crore (57.1 million) warrants and 5.1 crore (51 million) optionally fully convertible debentures (OFCD) were also issued to promoter group companies.

Meanwhile, Siti Networks will have Subhash Chandra’s brothers declassified as promoters of the company. Incidentally, the media assets of the Essel Group, including direct-to-home (DTH) company Dish TV and Siti Cable, are being formally divided among the brothers.

Further to the family arrangement between the promoter group, the company has received a communication from Chandra, Jawahar Goel, Laxmi Narain Goel and Ashok Kumar Goel. This relates to declassifying Jawahar Goel, Laxmi Narain Goel and Ashok Kumar Goel, along with their respective family members and persons acting in concert with them, as promoters of the company and persons acting in concert with them in terms of Regulation 31A of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The above arrangement will take effect on receipt of necessary corporate and regulatory approvals.

The company has also decided to alter and adopt a new set of articles of association to align it with the Companies Act, 2013, subject to the approval of shareholders in the general meeting. The company will hold its annual general meeting on 27 September.

Siti’s total digital subscriber base stood at 7.9 million across 312 cities, as on 31 March. Its cable TV universe was 12.2 million. Its total broadband subscriber base stood at 1.32 lakh.