PGCIL sets IPO price band of Rs 44-52; to raise up to Rs 3000cr

PGCIL sets IPO price band of Rs 44-52; to raise up to Rs 3000cr
PTI
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First Published: Sun, Aug 26 2007. 03 50 PM IST
Updated: Sun, Aug 26 2007. 03 50 PM IST
New Delhi: Power Grid Corporation of India Ltd, the country’s biggest transmission utility, has fixed a price band of Rs 44-52 for its initial public offer and sale of government equity to raise between Rs 2,500-3,000 crore.
The state-run, which filed its red herring propectus with market regulator Sebi for the public offer last week, fixed the price band of Rs 44-52 after consultations with merchant bankers. The range has also been approved an Empowered Group of Ministers set up for approving disinvestment of government holding in PSUs, official sources said.
The IPO is likely to be launched in the second week of September. The offer would constitute 10 per cent of fresh equity comprising 38.26 crore shares and sale of five per cent stake by the government amounting to 19.13 crore shares. Of the total size to 57.39 crore, about 1.39 crore shares have been reserved for employees.
At the lower end, it would raise Rs 2,525 crore and at the upper end the compant would mobilise Rs 2,984 crore. The company would retain 1,683-1,989 crore from the total proceeds, while the government would mop up Rs 841-994 crore.
PGCIL is the third central power utility to tap the capital market for raising funds after NTPC Ltd in 2004 and Power Finance Corporation early this year. Like NTPC and PFC, the government will piggyback on PGCIL IPO to divest five per cent of its stake. While NTPC had raised around Rs 5,400 crore, PFC had mopped up nearly Rs 1,000 crore.
Power Grid Corp is raising funds from the market to part-finance its expenditure requirements. The transmission sector requires an estimated investment of Rs 70,000 crore during the 11th plan and central utilities led by PGCIL are expected to contribute as much as Rs 50,000 crore.
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First Published: Sun, Aug 26 2007. 03 50 PM IST
More Topics: Powergrid | IPO | PGCIL | Money Matters | IPOs |