Ahmedabad-based denim fabric maker Nandan Denim is set to raise Rs 50 crores by issuing 2.5 million fully convertible warrants to UK-based foreign institutional investor Polus Global Fund. Nandan is India’s second and world’s fifth largest integrated denim fabric maker. The warrant holder will have to pay an amount equivalent to at least 25 per cent of the consideration on or before the allotment of warrants while the balance 75 per cent shall be payable on or before the time of exercise of the warrants.

The UK-based FII currently holds 1,35,000 shares or a 0.30 per cent stake currently in the company, which will increase to 2.63 million shares or 5.48 per cent post conversion of the warrants into equity shares.

The company will use the fresh funds for expansion projects. Nandan Denim is in the middle of its capex execution with an outlay of Rs 612 crores for expansion of its denim fabric manufacturing capacity, spinning capacity and shirting capacity. The capex has a requirement of equity funding to the tune of 30 per cent and this equity infusion, coupled with the internal accruals, would balance the funding while the external funds have already been tied up.

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