NEW DELHI: Aiming to make payment to Delhi Airport Metro Express Private Ltd (DAMEPL) against the arbitration award, the Delhi Metro Rail Corporation (DMRC) has launched a rights issue to raise Rs 7,131.28 crore.
The metro rail corporation has decided to offer Rs 7.13 crore shares with a face value of Rs 1,000 each. The rights issue has opened and will close by January 11 next year. As per the minutes of the 147th meeting of the Board of Directors of DMRC, the corporation launched the rights issue for both its equity stakeholders-Government of India (GOI) and Delhi government. Meanwhile, the DMRC has refused to comment over the development.
According to the minutes of the meeting, the DMRC, which is a 50:50 joint venture of the GOI and Delhi government, has requested both stakeholders to infuse Rs 3,565.64 crore each by way of their equity contribution. Under the rights issue, a company issues new equity shares to the existing shareholders to raise fresh funds. The rights issue was approved by the Board of Directors of DMRC in the meeting held on December 13.
The decision to launch the rights issue has reportedly been taken after DMRC did not get any response from the GOI and Delhi government on its request to share the total arbitration award as CAPEX expenditure. The Supreme Court had upheld an arbitration award of Rs 7,000 crore in favour of DAMEPL on September 9, 2021. It has also been reported that the DMRC tried to raise loans from banks to pay award money to DAMEPL, but later on, it informed the Delhi High Court that if the company raises debt from the banks, it will fall into a debt trap as it cannot service the debt through its revenue.
The DMRC then reportedly approached the GOI and Delhi government for financial assistance. A meeting to this effect was held on November 10 between the top officials of the Ministry of Housing and Urban Affairs (MOHUA), the Delhi government, and leading banks but the DMRC did not get any funds from both its equity stakeholders. The DAMEPL’s execution petition is reportedly pending in the Delhi HC. The Supreme Court has reportedly directed the HC to ensure that the arbitration award is executed within three months.
Payment to DAMEPL
DMRC launched a Rights issue of Rs 7,131.28 cr
The DMRC decided to offer 7.13 crore shares with a face value of Rs 1,000 each to both equity stakeholders-Government of India (GOI) and Delhi government.
Both stakeholders to infuse Rs 3,565.64 crore each by way of their equity contribution
The proceeds of the same will be used to make payments to DAMEPL against the arbitration award