Azure Power’s $250 million Rights Issue Subscribed 78.4%, Saved By Largest Stakeholders

Azure Power Global Limited announced today the final results of its previously announced rights offering of $250 million. By the end of the subscription period on January 24, 5:00pm EST, 78.4% of the rights had been exercised, and, accordingly, 12,404,282 newly issued equity shares of the Company were subscribed. The remaining 3,424,635 unsubscribed shares will be purchased at the rights offering subscription price by CDPQ Infrastructures Asia Pte Ltd. and OMERS Infrastructure Asia Holdings Pte. Ltd. (“OMERS”) under the Backstop Commitment Agreement with the Company. The two are also its largest shareholders currently. Under the Backstop Agreement, CDPQ will purchase 2,054,781 of the unsubscribed equity shares and OMERS will purchase 1,369,854 of the unsubscribed equity shares. After taking into account the equity shares subscribed under the rights offering and purchased pursuant to the Backstop Agreement, the Company will have raised gross proceeds of $249,938,599.

Investors (other than the backstop shareholders) who have participated in the rights offering should expect to see the shares of common stock issued to them in book-entry or, uncertificated, form on or about January 28, 2022.

Even as the issue has barely scraped through with help from its backstop agreements with key investors, the firm will breathe a sigh of relief on the culmination of the issue. The $250 million (Rs 1875 crore) infusion will certainly  help the firm meet its objectives of retiring expensive debt, making acquisitions, and funding future projects. It’s long delayed manufacturing linked solar project has also recently started moving after SECI finally found some buyers for the power, albeit at a markdown to the bid price Azure had won the projects with, along with Adani Green Energy.