Engineering company Titagarh Rail Systems Ltd on Wednesday said it plans to raise up to Rs 700 crore through a Qualified Institutions Placement (QIP) and seeks a strategic partner for the shipbuilding, bridges, and defense business. In a regulatory filing, the company said proceeds from the QIP will be used to strengthen the company’s position in its core businesses and to fund future growth initiatives. The company will seek the requisite approval from its shareholders for the QIP issue.
Its board approved the QIP plan at its meeting and also constituted a committee for scouting a partner for the Shipbuilding, Bridges and Defense (SBD) business. Currently, wagons and rail passenger coaches are its core operation and are foraying into railway wheels through a joint venture.
The company in June had also approved raising Rs 288.80 crore through preferential allotment of shares to Smallcap World Fund Inc., resulting in a 5.98 percent stake in the wagon maker.
In addition to the QIP, the company has also set up a committee of directors to identify a strategic or joint venture partner for its SBD business. The committee will also take assistance from external advisors or merchant bankers for this purpose.
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