The Hindu Business Line : Srei Infrastructure Finance plans $50-m GDR to fund expansion

THE board of directors of Srei Infrastructure Finance Ltd (SIFL), formerly Srei International Finance, which met here on Thursday after the company's extraordinary general meeting, has approved an issue of global depository receipts (GDRs) in the international market up to $50 million plus a permissible green shoe or over-allotment option.

According to informed sources, this may be preparatory to seeking a listing on a major stock exchange like the London Stock Exchange.

It is learnt that the company was now talking to several international investment bankers, and the entire programme is likely to be tied up within the next one and half months or so.

Talking to Business Line here on the board's decision over the GDR issue, and other points on the EGM agenda, Mr Hemant Kanoria, Managing Director of the company, said this was in keeping with expansion of the company's financing business in Europe, with new offices having been opened in Germany, Russia and the UK.

He said having begun operations way back in 1989, Srei has now come a long way, and was now "a mature organisation with an international presence. We are now in the consolidation phase with regard to our operations in Europe," he pointed out.

Explaining further, Mr Kanoria said since infrastructure has been the core business of the company in the last 15 years, and encouraged by the growth in this area, "We see that the need for further capital is a sine qua non for us. Srei is expanding its business globally, hence it is logical for us to look at a GDR issue."

Among the major global stakeholders in Srei are IFC, Washington (World Bank Group), DEG, Germany (FI owned by the German Government ), FMO, Netherlands (owned by the Dutch Government) and BIO (a Belgian FI owned by the Belgium Government).

The shareholders at the EGM approved issue of further securities of the company in one or more tranches in domestic and/or international markets up to an aggregate amount not exceeding Rs 5,000 crore or equivalent thereof in any foreign currency.

Besides okaying the re-classification of the authorised share capital of the company, shareholders also approved an increase in limit for investments by foreign institutional investors and other eligible non-resident investors in the company up to 74 per cent of the issued and paid up capital of the company.

The total foreign shareholding of the company as on December 31, 2004 comprises 92,04,280 shares representing 17.27 per cent of the paid-up share capital of the company.

The authorised share capital of the company at present is Rs 700 crore, divided into 10 crore equity shares of Rs 10 each, 150 lakh preference shares of Rs 200 each, 200 lakh preference shares of Rs 100 each, shares and 200 lakh preference shares of Rs 50 each.

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