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Reliance Energy - Outcome of Board Meeting Reliance Energy Ltd has informedthat the Board of Directors of the Company was held on February 24, 2008. The following media release issued by Reliance Power Ltd, which, inter alia, incorporates the decisions of Board of Reliance Energy Ltd, which is self explanatory: "Reliance Power Ltd has informed that the Board of Directors of the Company at its meeting held on February 24, 2008, has approved a proposal for issuing free bonus shares to all categories of shareholders, excluding the promoter group (comprising of Reliance Energy Ltd. and the ADA Group), in the ratio of 3 shares for every 5 shares held, subject to necessary approvals. The proposed bonus offering will result in reduction of the cost of Reliance Power shares below the IPO price as follows: Rs 269 per share for retail investors, 40% lower than the IPO price of Rs 430. Rs 281 per share for other investors, 37% lower than the IPO price of Rs 450. In a related development, Mr. Anil D Ambani, Chairman, Reliance ADA Group, on February 24, 2008 simultaneously announced a voluntary contribution of 2.6% of his shareholding in Reliance Power to Reliance Energy Ltd., to protect the Company from any dilution of its existing 45% stake in Reliance Power, as a result of the bonus proposal. Accordingly, Reliance Energy's stake in Reliance Power will be maintained at the existing level of 45%, and the revised shareholding pattern of Reliance Power will be as follows: -------------------------------------------------------------------------------------------- Existing Proposed -------------------------------------------------------------------------------------------- Anil D Ambani 45% 40% Reliance Energy 45% 45% Public shareholders 10% 15% -------------------------------------------------------------------------------------------- The reduction of Mr. Ambani's shareholding in Reliance Power by 5% from 45% to 40%, represents a contribution of nearly Rs 5,000 crore (US$ 1.2 billion) by him, in favor of nearly 6 million investors in Reliance Energy and Reliance Power. Commenting on the move, Mr. Ambani said, "I have been personally concerned by the notional losses arising to millions of long term investors in Reliance Power, as a result of a dramatic adverse change in sentiment in global and domestic capital markets, subsequent to the pricing of our IPO. Though equity shares are by their very nature risk-bearing instruments, nevertheless, we have taken these one-time and unprecedented measures today, in demonstration of our philosophy of endeavoring to protect and enhance value for all our long-term shareholders." Based on the proposal for issuance of bonus shares, the paid up share capital of the Company will stand increased to 239.7 crore equity shares of Rs 10 each. Reliance Power's IPO closed on January 18, 2008, receiving an overwhelming and record breaking response, with commitments of nearly Rs 7,50,000 crore (US$ 190 billion), from nearly 500 institutional investors across the globe, and 5 million retail investors. Reliance Power has the world's largest shareholder family of nearly 500 overseas and domestic institutional investors, and over 4 million retail investors. Reliance Power has a market capitalization of over Rs 94,000 crores (over US$ 23 billion) – among India's 10 most valuable private sector Companies, and a net worth of nearly Rs 14,000 crore (over US$ 3.5 billion) – among the top 5 private sector Companies in India on this parameter. Reliance Power is implementing power projects with aggregate capacity of over 28,000 MW, by far the largest development pipeline in the country."