N Vasudevan

Bangalore

IT products maker Subex said it would raise

Rs 48 crore by issuing shares

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to its promoter Subash Menon on a preferential basis and the move would partly make up for the reduction of his shareholding due to the recent conversion of foreign currency convertible bonds (FCCBs).

The firm would issue

6 million shares to an investment company owned by Menon, as part of placement at Rs 80 apiece, an

32 per cent premium to

the company’s closing share price of Rs 60.35 on Monday.

“The primary objective of this preferential placement is to increase my stake in the company. The fact that I am infusing funds into the company at a price that is higher than the Sebi floor price shows my conviction in the future prospects of the company,” Menon, chairman and managing director said on Tuesday.

Subex had recently restructured a majority of outstanding FCCBs at a conversion price of Rs 80.31.

As of December, Menon had a 6.58 per cent stake in the company and Kivar Holdings had 3.88 per cent, as per disclosures with the stock exchanges.

The placement, pending shareholder approval, wou-ld be completed in the next 30 to 45 days and the company would use the proceeds of the issue to reduce some of the liabilities like bank loans.