Heritage Foods spikes 16% as board approves 1:1 rights issue

New Delhi: Heritage Foods (HFL) on Friday announced that its board at the meeting held today approved the raising of funds on a rights issue basis.

The company said it would issue equity shares in the ratio of 1:1 by the way of the rights issue at the face value of Rs 5 per equity share to the existing shareholders of the company as on the record date.

The record date for the same will be notified later, the company informed bourses via an exchange filing. The promoter and promoter group of the company may subscribe to all the unsubscribed shares in the issue, if any, it said.

The company will issue 4,63,98,000 equity shares with a face value of Rs 5 each, aggregating to about Rs 23.2 crore.

Following the announcement of the issue, shares of Heritage Foods shot up over 16 per cent to Rs 362.20 on Friday. The scrip had ended the previous session at Rs 311.05 on BSE.

All eligible shareholders will get one new fully paid-up equity share for each fully paid-up share held by them as of the record date.

"The board has constituted and authorized ‘Rights Issue Committee’ to decide detailed terms and conditions of the issue, including but not limited to deciding the payment modalities/schedule thereof, record date, timings, other terms and conditions and all other related matters," the filing added.

Post the rights issue, the company's outstanding equity shares capital will double to 9,27,96,000 equity shares from the existing 4,63,98,000 equity shares.