Advanta India Ltd, a seed maker that is part of the United Phosphorus group of companies, said in a filing to exchanges that it has raised $50 million (around Rs.225 crore) crore through foreign currency convertible bonds, or FCCBs.
The bonds carry an interest rate of 3.5 percentage points higher than the London inter bank offer rate, or Libor, a benchmark rate that is currently at 0.245%. The conversion into equity will be at Rs.282.84 a share, which translates into apremium of 10%, and at a fixed rate of Rs.44.94 to the dollar.
The company’s shares ended trading at Rs.255 each on the Bombay Stock Exchange on Thursday.
Advanta plans to use part of the money to invest in its overseas subsidiaries. It owns 100% of Crosbyton Seed Co., Limagrain’s sunflower business, and Garrison and Townsend, all based in the US, Golden Seeds Pvt. Ltd and the vegetable seeds business of Unicorn Seeds Ltd.
Credit Suisse (Singapore) Ltd was the sole book runner to the issue.
An analyst said it could also use the money to repay debt and for working capital. “Though the fundamentals of the company are strong, it was facing problems in terms of raising working capital loans. The debt on its books were accumulated mainly because of the acquisitions,” added this person, who tracks the company but did not want to be identified.
Advanta posted a net loss of Rs.3.45 crore (including the profits and losses of its subsidiaries) for the three months ended 31 March compared with a net loss of Rs.1.28 crore in the year-ago period. Its revenue for the three months was Rs.175.74 crore.
Source: Livemint