New Delhi: US and European institutional investors bought a majority of shares in the over Rs 4,800-crore QIP offering by telecom operator Reliance Communications.

"About 84 percent of QIP was picked up by Sovereign Funds and Pension Funds from US and Europe. A large chunk was also picked up by Indian mutual funds," a source said.

After the Qualified Institutional Placement (QIP) share allotment, promoter shareholding in RCom will drop to 60 percent from 67 percent while foreign holding will be 23 percent.

An RCom spokesperson did not comment on the matter.

In a regulatory filing, RCom said its committee of the Board of Directors at a meeting held Wednesday has issued and allotted 33,82,86,197 equity shares to the eligible Qualified Institutional Buyers (QIBs) at a price of Rs 142.14 per Equity Share aggregating to Rs 4,808.40 crore.

Further the company has informed that, post the said allotment, the paid-up equity share capital of the company stands increased to about Rs 1,201 crore comprising of 2,40,23,13,078 equity shares of Rs 5 each.

The RCom QIP -- the biggest by a private firm in India -- is larger than the previous institutional fund raising by Axis Bank (about Rs 4,700 crore), Adani (Rs 4,000 crore) and GMR (Rs 3,966 crore.

The fund raising will help the company reduce its debt that has doubled to Rs 40,177.6 crore in four years.

Proceeds of QIP will be used to repay high cost rupee debt. Interest cost savings will be over Rs 800 crore per year, sources said.

Shares of RCom today closed at Rs 144.9, down 0.65 percent, compared to their previous close at BSE.

(PTI)