Reliance raises $763 million through share sale

Energy major Reliance Industries Ltd today raised $763 million selling 33 million existing treasury shares at a discount of about 5 per cent to a number of foreign institutional investors.

This is the company's third big equity fund raising in under four months, as it moves to buy bankrupt petrochemicals firm LyondellBasell.

The latest share sale, by the Mukesh Ambani-led firm comes close on the heels of a $577-million divestment last week to state-run Life Insurance Corp of India.

In September, the company had transacted a $660-million share sale. According to analysts, the deals are a part of Reliance's bid to take control of the Luxembourg-based LyondellBasell.

Last week, Reliance had improved its offer for a controlling stake to $13.5 billion as compared to its earlier bid of $12 billion (See: Reliance hikes offer for LyondellBasell to $13.5 billion). But The Wall Street Journal reported that Lyondell's board had rejected Reliance's revised offer.

Analysts say the company needed funds for acquisitions which could be either Lyondell or some other company. They add that the company did not want to stretch its balance sheet too much and was thinking of keeping their balance sheet as clean as possible in case they needed to raise further debt.