New Delhi: Adani Power Limited, which has proposed an initial public offering, may go in for pre-IPO placement of up to Rs2,000 crore to partly fund its 9,000-MW power projects.
“The company is considering a pre-IPO placement of equity shares with various investors,” the Adani Group firm says in its draft red herring prospectus, filed with market regulator SEBI. The company is seeking to raise more than Rs5,000 crore through the IPO.
It has proposed to come out with a public issue 29.70 crore equity shares of Rs10 at a premium to set up six power projects at an estimated cost of about Rs43,139 crore.
The company proposes to fund 20% of the project cost through equity and the remaining through third party debts.
The funding proposals, as per the DRHP, includes Rs5,630 crore from IPO, Rs1,332 crore from existing equity/internal accruals and Rs26,854 crore from third party debt.
As the premium for the equity share will be decided later through the book building route, the company may need to raise more resources to make up for the shortfall.
The DRHP further says that the public issue size would be reduced to the extent of such pre-IPO placement, subject to a minimum net issue size of 10% of the post issue paid-up capital.
APL is offering 14.35% shares as part of the public issue, excluding the pre-IPO placement.
The six power projects to be developed by the APL include Mundra I and II, which will have four sub-critical generation units of 330 MW each. These units are expected to commence operations from January 2009 and would be fully commissioned by October that year.