REC to raise about Rs2,900 cr via FPO or QIP

REC to raise about Rs2,900 cr via FPO or QIP
PTI
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First Published: Wed, Jul 22 2009. 02 11 PM IST
Updated: Wed, Jul 22 2009. 02 11 PM IST
New Delhi: To enhance its lending capacity, state-run power utility Rural Electrification Corp plans to raise around Rs2,900 crore, either through Qualified Institutional Placement or follow-on public offer.
“We have requested the power ministry to raise fresh equity of 20% of the existing capital of Rs858 crore either through QIP or through the follow-on public offer,” director finance, REC, H D Khunteta told the agency.
REC would issue around 17 crore shares of Rs10 face value each at a premium to be decided by the company later.
“Considering present economic conditions it would fetch us (premium) of about Rs28-2,900 crore,” Khunteta said.
The company plans to use the capital raised to disburse loans to power projects.
The power ministry is believed to have sent the company’s proposal to the disinvestment wing of the finance ministry and is awaiting cabinet nod.
“The follow-on public offer to raise funds would take about 4-6 months whereas the QIP would be done within two months of the date of approval from the cabinet,” he added.
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First Published: Wed, Jul 22 2009. 02 11 PM IST