Board Approvals
The Board considered and approved two key items:
1. Increased Borrowing Authorization: Approved increasing limits/authorization to the Board up to ₹500 Crore (Rupees Five Hundred Crore only) under Sections 180(1)(a), 180(1)(c) and 186 of the Companies Act, 2013. This approval is subject to shareholder approval through postal ballot.
2. Corporate Guarantee for Subsidiary: Approved providing Corporate Guarantee/Security up to ₹150 Crore (Rupees One Hundred Fifty Crore only) in favour of HDFC Bank Limited/other Banks or financial institutions. This guarantee is for various credit facilities availed or to be availed by Sumati Spintex Private Limited, a subsidiary company, for its business operations.
Additional Details on Corporate Guarantee
- Name of Party: Sumati Spintex Private Limited (Subsidiary Company)
- Promoter Interest: The promoter/promoter group has an interest in this transaction due to common Directors between RRIL Limited and Sumati Spintex Private Limited. The transaction is stated to be conducted at arm's length.
- Agreement Details: The corporate guarantee/security will be provided from time to time, up to the ₹150 Crore limit, subject to terms and conditions stipulated by the respective lenders and execution of necessary guarantee documents.
- Financial Impact: The corporate guarantee will create a contingent liability in the books of RRIL Limited to the extent of the guarantee amount (₹150 Crore).