UCO bank to raise Rs900-950 cr from FPO

UCO bank to raise Rs900-950 cr from FPO

Kolkata: UCO Bank is likely to raise Rs900-950 crore from follow-on-public offer after a strong rally in the stock market.

“As per the current market conditions, getting a premium of Rs60 will not be a problem. A premium of around Rs50 a share was expected earlier," UCO Bank chairman and managing director S K Goel said.

He said the final pricing would be made later after consulting the merchant bankers. The issue has been expected to hit the capital market in January, sources said.

With revival in the stock market, UCO bank authorities had revised estimates of premium for the issue from Rs50 to over Rs60 a share.

The bank is likely to use the book building route for the FPO rather than fixed pricing method when the bank first hit the stock market in 2003 at a premium of Rs2 for each share of Rs10.

The bank has been expecting better valuation with entry into insurance business which is likely to be in place soon.

Goel said they were expecting government approval for the FPO by October and soon after the bank would initiate the process to get Sebi approval.

The bank is aiming to enhance CAR to 12% from 11.75%.

The bank would plan to hit the market with 13.5 crore shares of Rs10 each. The issue would bring down the government shareholding close to 51% from 63.5% now.