Essar Group-Backed Black Box Raises Rs 410 Crore to Expand Global Data Centre Infrastructure Services

In a strategic move poised to reshape the landscape of data centre infrastructure services, Black Box, an Essar Group-backed IT systems integrator, has successfully raised Rs 410 crore through a preferential issue. This funding aims to capitalize on the burgeoning demand for AI computing and further enhance their global footprint.

Strategic Investment to Meet Growing AI Demands

Black Box's latest financial maneuver underscores its commitment to expanding its data centre infrastructure services, catering to a prestigious clientele that includes tech giants like Amazon, Google, and Microsoft. The funds will be directed towards advancing services for hyperscalers, multi-tenant data centre operators, and large enterprise data centres, in addition to bolstering connectivity and networking infrastructure.

A significant portion of the investment will also target sales and business development efforts in North America and emerging markets, positioning Black Box as a formidable player on the global stage.

Details of the Funding Round

The company’s Board of Directors approved the issuance of 98,32,123 fully convertible warrants at a price of Rs 417 each, aggregating to Rs 410 crore, as per the exchange filing on Friday. The breakdown of the funding round is as follows:

- Rs 200 crore from existing promoters

- Rs 200 crore from foreign institutional investors and high-net-worth individuals

- Rs 10 crore from key management personnel of the company

Following the conversion of these warrants into equity, promoter shareholding will see a slight decrease from the current 71.1% to 69.8%.

For the fiscal year ending March 2024, Black Box reported a net profit of Rs 138 crore, marking a remarkable 5.8-fold increase year-on-year. The company's earnings before interest, tax, depreciation, and amortization (EBITDA) stood at Rs 428 crore, reflecting robust financial health and operational efficiency.

The announcement of the preferential issue had an immediate positive impact on Black Box’s stock. Shares hit the upper circuit before trading was halted early on Friday, closing up 4.99% at Rs 557.35 on the BSE.

Headquartered in Mumbai, Black Box operates across 35 countries and serves over 1500 customers worldwide. This strategic funding initiative not only reinforces its position in the market but also aligns with its vision to deliver cutting-edge digital infrastructure solutions on a global scale.