Renuka Holdings to raise Rs.1bn via rights issue

Diversified entity, Renuka Holdings PLC, on Monday announced its plans to raise Rs.1.03 billion via a rights issue to settle debts and for future investment purposes.

The company with interests in agro foods, organic plantations, FMCG, dairy, and property & investment said it will issue 66 million new ordinary voting shares at Rs.14 per share and 9 million ordinary non-voting shares at Rs.10 per share.

Three new ordinary voting shares will be issued for every four existing ordinary voting shares. The same ratio will be applied to the new ordinary non-voting shares.
The net asset per share of Renuka Holdings PLC was Rs. 55.39 as at June 30, 2020. 

Renuka Holdings share closed at Rs.15.10 yesterday, down Rs.2.50 from the previous close on Monday.The current stated capital of the company as at June 30, 2020 is Rs.1.2 billion, and a full subscription of the rights issue would expand it to Rs. 2.23 billion.

The rights issue is subject to shareholder approval at an EGM and regulatory approval to list the new shares on the Colombo Stock Exchange.

As at June 30, 2020, Renuka Group Limited held 41.2 million shares or 46.27 percent stake in Renuka Holdings as the single largest shareholder of voting shares followed by Dr. S.R. Rajiyah and I.R. Rajiyah jointly holding 17.4 million shares or 19.5 percent stake. 

Minority shareholder activist K.C. Vignarajah is the single largest shareholder of non-voting shares of Renuka Holdings with 626,851 shares or 4.88 percent.For the financial year ended June 30, 2020, Renuka Holdings recorded group earnings of 49 cents a share or Rs.50.4 million compared to earnings of 4 cents a share or Rs.3.7 million on revenue of Rs.7.8 billion.The group had little over Rs.1.3 billion loans and borrowings under current liabilities.