Parag Milk Foods said this fund raise is subject to shareholder’s approval in ensuing extraordinary general meeting scheduled on April 26, 2021, as well as regulatory approvals.
Parag Milk Foods said International Finance Corporation (IFC) is proposing an investment of up to Rs 155 crore by way of subscription to preferential issue of equity shares and subscription of FCCBs in addition to proposed subscription to NCDs of Rs 150 crore committed in December.
Sixth Sense Venture Advisors has proposed an investment of Rs 50 crore by way of preferential allotment of 45,04,505 equity shares of face value Rs 10 each at a price of Rs 111 each, the company said.
As per the regulatory filing, the promoters will invest Rs 111 crore that includes preferential allotment of 50,00,000 convertible share warrants in the name of Devendra Prakash Shah along with 50,00,000 to Netra Pritam Shah, convertible into equity shares with a face value of Rs 10 each fully paid up, on a preferential basis, at a price of Rs 111.
Devendra Shah, Chairman, Parag Milk Foods said, “The funds that will be raised through FCCB will be utilised for meeting our capex requirements over the next two years and would free up our cash flows during that period.
Additionally, the proceeds of preferential shares and warrants would be utilised to reduce short-term debt limits and enhance working capital for future growth. This would provide enough firepower to bolster the balance sheet and propel the company for future growth, he said.