Tuni Textile Mills manufacturer of grey fabrics has filed its Letter of Offer for a rights issue to raise up to Rs 48.99 crore (US $5.11 million) through the issuance of 48,98,66,250 equity shares of face value Rs 1 each at par.
The rights issue will be offered in a ratio of 15 shares for every four shares held by eligible shareholders as on the record date of September 16. The issue is scheduled to open on September 28 and close on October 26.
According to the Letter of Offer, the company plans to use Rs 10.55 crore (US $1.10 million ) of the proceeds toward repayment of loans and Rs 22.21 crore US $2.32 million (US $2.32 million) for working capital requirements.
The company has also earmarked Rs 2.86 crore US$0.30 million (US$0.30 million) for renovation and infrastructure improvements at its Murbad facility, while Rs 3.51 crore (US $0.37 million) will be used for machinery upgrades.
The rights shares will be issued only in dematerialised form. Infomerics Valuation and Rating Private Limited has been appointed as the monitoring agency for the utilisation of the issue proceeds.
The promoter group has indicated that it will not fully subscribe to its rights entitlement and may renounce part of its entitlement. The promoters have also stated that they do not intend to apply for additional shares beyond their entitlement.
The company will now proceed with the rights issue as per the announced schedule, with subscription levels and the utilisation of funds for debt repayment, working capital and Murbad facility upgrades to be key developments following the issue.
