Date:16/12/2005 URL: http://www.thehindubusinessline.com/2005/12/16/stories/2005121603171400.htm

Back PSL plans pref allotment to IFC to raise $5 m

Our Bureau

New Delhi , Dec. 15

PSL Ltd, manufacturers of steel pipes, today said it will raise $5 million from International Finance Corporation (IFC). The company's board has approved the raising of additional funds from IFC, through preferential allotment of nine lakh equity shares of the company at Rs 252 a share, as per SEBI guidelines.

The allotment would be subject to other necessary approvals, as may be required, including the consent of the shareholders, for which an EGM is being convened on January 12.

With this equity placement, PSL will complete its fund raising campaign aggregating Rs 350 crore, which will comprise, in part, private placement of about 10 per cent equity, a FCCB Bond Issue of $40 million and long-term loans including $15 million from IFC.

The accretion of these funds will be used for PSL's major capacity expansion and upgradation at its existing pipe manufacturing plants at Kandla and Vizag along with a major upgradation programme of its other existing pipe mills and coating plants at Ahmedabad, Daman and Chennai.

According to Mr Ashok Punj, Managing Director, PSL: "The investment programme will meet PSL's new additional capacity creation at Kakinada where we have acquired land for our new plant, it will also include a minimum of two overseas locations, in West Asia and North African regions. This expansion programme is projected to be completed by December 2007 and will raise the company's capacity to manufacture steel pipes from the existing level of one million tonnes per annum to 1.5 mt ."