Reliance Power announces 3:5 bonus issue to shareholders

Mumbai, Feb 24 (PTI)

In a determined bid to salvage Reliance Power's IPO, which received a severe blow on its listing day, Group Chairman Anil Ambani today announced three bonus shares for every five held by non-promoter shareholders to bring down the cost of acquisition from Rs 430 to Rs 269.
Announcing the decision of the bonus issue taken by the board of Reliance Power, Ambani also said he would transfer shares worth Rs 5,000 crore from his promoters quota to Reliance Energy.

Consequently, the public shareholding in Reliance Power would increase to 15 per cent from 10 per cent earlier, while Ambani's stake would come down from 45 per cent to 40 per cent.

The move to transfer Ambani's personal shares to Reliance Energy would enable the promoter company to retain 45 per cent shareholding in Reliance Power.

The move also answers apprehensions that the bonus for Reliance Power shareholders could come at the cost of shareholders in REL.

Shares of Reliance Power closed at Rs 372 on the day of listing on February 11.

"I will protect the dilution of REL shareholders from 45 per cent to 42.5 per cent at the proposed bonus shares which is a dilution of 2.6 per cent roughly. I will be diluting my personal shares free of cost to Reliance Energy shareholders, whereby REL shareholding in Reliance Power remains intact at 45 per cent," Ambani said at a press conference here.

As a result of the voluntary contribution of 2.6 per cent of his shareholding in Reliance Power to Reliance Energy, Ambani's shareholding will come down from 45 per cent to 40 per cent in Reliance Power. PTI