(1 February 2007 6:00 am)

MUMBAI: Wire & Wireless India Ltd (WWIL), Zee Group's demerged cable company, is likely to raise $100 million through qualified institutional placement (QIP) to fund its expansion programme including digitalisation and acquisition of cable operators.

"WWIL is likely to raise $100 million via QIP as part of its fund raising programme but will take a final decision on this soon. Everything will depend on the market conditions," a source close to the company says.

When contacted, WWIL managing director Jagjit Singh Kohli said the exact amout and instrument has not yet been decided. "I will be able to comment after we have decided and taken the shareholders' approval," he added.

WWIL is making a preferential issue of convertible warrants to Jayneer Capital, a promoter group company, up to Rs 1.31 billion as part of its fund raising programme. This will translate to around 5 per cent equity in WWIL. The conversion price of the warrants into equity shares will be at Rs 122. The company has convened an EGM (Extra Ordinary General Meeting) on 26 February for shareholders' approval on the issue of preferential warrants.

"The dilution, along with the warrants, will be around 20 per cent at the current prices if WWIL takes up the $100 million mopping up exercise through QIP," the source says.

WWIL has aggressive plans to expand its digital cable business and had earlier projected a fund requirement of Rs 7.14 billion over two years.

The company recently announced that it would seek shareholders' approval for raising up to $250 million (approximately Rs 11.25 billion). The board which met on Monday considered all the fund raising options including issue of ADR (American depository receipt), GDR (global depository receipt), equity, debt, debentures, FCCB (foreign currency convertible bond), QIP (qualified institutional placement) and convertible warrants.