Surana Industries raises $ 25 mn through FCCB

Chennai, June 19: The city-based Surana Industries Limited (SIL), a leading steel manufacturer, today announced that it has issued Foreign Currency Convertible Bonds (FCCB) to the extent of US Dollar 25 million.

The funds raised by way of FCCB would be utilised for the new integrated steel plant, coming up at Raichur at a total cost of Rs 473 crore, company Managing Director Dinesh Surana told newspersons here.

''Besides term loans from banks to the extent of Rs 331 crore, the remaining portion of Rs 142 crore for the plant will be met out of equity sources,'' he added.

The bonds would be converted into equity shares at a price of Rs 140 per share, he said, adding that this was the first attempt made by the company to raise FCCB.

Mr Surana said that with the success of this issue, the company would raise further funds by way of 'Qualified Institutional Placements' for around US Dollar 25 million to meet the cost of the future expansion of the company.

''After setting up the Raichur plant, which will be operational by 2008, the total turnover of the company will exceed Rs 1,200 crore and profitability will touch Rs 100 crore per annum,'' he said.

He highlighted that the new plant would generate job opportunities for more than 1,200 people, mostly local people.

According to statistics given by the company officials, the new steel complex at Raichur would have a production capacity of 1,28,000 tonnes of Sponge Iron, 2,25,000 tonnes of steel melting shop and two lakh tonnes of rolling mill annually.

UNI