Investment bank Goldman Sachs has taken an additional 6.7 per cent of Indian cable distribution DEN Networks, and in the process boosting its overall position in the cable TV giant to 24.49 per cent.
DEN will hold an extraordinary general meeting of shareholders on October 14th to gain formal approval for the move. The shares are in the form of preferential allotments, that is new shares issued at a discount to the current market price.
In an interview to CNBC-TV18, CFO Manish Dawar said the money would be used for expansion of broadband and reduction of debt.
Goldman Sachs has now hit the limit as to what it can own in DEN without triggering a full take-over bid, which reportedly is not the plan.
The extra capital generated is not unexpected, and was confirmed September 20th in statements to the Bombay Stock Exchange. DEN Networks share price immediately gained 8 per cent on the news.