Birla Power Solutions to raise $100 million; stock up

MUMBAI: Portable generator-maker Birla Power Solutions is looking at raising up to $100 million in the current financial year from private equity players to part finance its diversification plans, the company's managing director told ET. The Yash Birla-led company has planned an investment of 10,000 crore over the next five years to foray into thermal and solar power .

At 9:50 am, shares of Birla Power Solutions were trading 2.70% up at Rs 1.14 on the Bombay Stock Exchange.

For this, Birla Power Solutions may sell up to 15% stake in itself or up to 26% in its subsidiary, Birla Urja, to a private equity player, PVR Murthy said.

"We are talking to 3-4 global private equity investors. Traditionally, we have not had institutional investors but if we are growing big, we need to have them," Murthy said. The company could induct a representative of the PE fund on the board of the company.

"We would rope in their professional practices. We have no issue if they come in at parent company level or at subsidiary level," Murthy said.

The company has a market capitalisation of 239 crore. For expansion into the power sector, Birla Power Solutions will need an equity investment of 2,000 crore, while the balance 8,000 crore would be funded through debt.

Birla Power will also undertake a global depository receipt issue and promoters will infuse funds via warrant conversion to boost the company's equity base. Promoters currently hold 4.04% in the company. They also hold warrants, which on conversion would raise the holding to around 13%, Murthy said.

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