×
Home Companies Industry Politics Money Opinion LoungeMultimedia Science Education Sports TechnologyConsumerSpecialsMint on Sunday
×

10 i-banks compete to manage GSPC’s September public issue

10 i-banks compete to manage GSPC’s September public issue
Comment E-mail Print Share
First Published: Wed, Mar 05 2008. 12 02 AM IST
Updated: Wed, Mar 05 2008. 12 02 AM IST
Mumbai: Ten merchant banks have put their hands up to manage Gujarat State Petroleum Corp. Ltd’s (GSPC) fresh proposal for an initial public offering (IPO) in September, with the company now fetching a 50% premium over its valuation in late 2006 when it made its first approach for an issue.
GSPC, which postponed its earlier plans for an IPO, has not yet handed out the mandates, but bankers involved in the said GSPC could raise $1.5 billion (Rs6,045 crore) from its IPO. The quantum of shares on offer will be decided after mandating the bankers.
“The revaluation was done factoring the developments in the Krishna-Godavari basin (KG basin),” said a banker involved in discussions for the issue. In December, GSPC had said it struck natural gas at two more wells in its Krishna-Godavari field in the eastern coast of India, off Andhra Pradesh, known as Deendayal block.
In mid-2005, GSPC announced its biggest ever discovery of 20 trillion cu. ft of natural gas from the basin, though it has yet to get official seal from the Director General of Hydrocarbons (DGH), the country’s reserve certifying authority.
Citigroup Global Markets India Pvt. Ltd, UBS Securities India Pvt. Ltd, Deutsche Securities (India) Pvt. Ltd, JPMorgan India Pvt. Ltd and DSP Merrill Lynch Ltd are the five foreign investment banks that attended the second round of IPO talks in February.
The domestic line-up had SBI Capital Markets Ltd, ICICI Securities Ltd, Enam Securities Pvt. Ltd, Kotak Mahindra Capital Co. Ltd and JM Financial Consultants Pvt. Ltd.
A GSPC executive, who did not wish to be named in the run-up to the IPO, said the Gujarat State Financial Corp. may also be invited to help manage the IPO, but at a later stage.
GSPC had mandated Citibank, UBS, Morgan Stanley and HSBC for its earlier IPO plan.
Meanwhile, the company will need more money than what it can raise from the proposed IPO to fund its exploration activities, said another banker who attended the IPO talks.
To meet its fund requirement, GSPC, which has already spent more than $500 million in exploration operations at the KG basin, recently obtained a line of credit from a consortium of banks led by the State Bank of India for around Rs3,000 crore.
GSPC had also called off its efforts to offload up to 30% equity in its offshore exploration and production block at the KG basin, more than two years after it began its process. In April 2006, GSPC invited bids from international hydrocarbon players for this stake.
nesil.s@livemint.com
Comment E-mail Print Share
First Published: Wed, Mar 05 2008. 12 02 AM IST