Enthused by buoyant market conditions, the government today said it may advance SAIL share sale and launch the FPO by December 2010 instead of earlier planned January-February next year.
Steel Authority of India Ltd's (SAIL) Follow-on Public Offer (FPO) is expected to raise Rs 8,000 crore in the first phase.
"Market conditions are buoyant. If it remains like this, we may consider advancing SAIL FPO in the calendar year 2010," Steel Secretary Pradeep Kumar Misra told reporters on the sidelines of Ficci steel summit here.
Showing buoyancy, the stock market benchmark sensex today crossed 20,000 mark in the opening trade for the first time since January 17, 2008.
State-owned SAIL has already shortlisted six bankers, including JP Morgan and Deutsche Bank, for managing the first phase of its upcoming Follow-on Public Offer (FPO).
SBI Capital, Enam Securities, Kotak Mahindra Capital and HSBC are the other bankers for the FPO which was slated to hit the market in January-February 2011.
The banks will manage the first phase of its 20 per cent share sale programme, under which the government plans to divest 5 per cent of its stake in the company, while the steel giant will issue additional shares equivalent to 5 per cent stake.
Another 10 per cent stake will be sold under the second phase of the FPO, the timing of which will be decided later. The two-phase FPO may help raise a total of Rs 16,000 crore.
At present, the government holds a little over 85 per cent stake in SAIL and post-FPO, its equity in the company is expected to go down to about 69 per cent.
SAIL wants to part-fund its Rs 70,000 crore expansion programme with the proceeds from the share sale, while for the government, the stake dilution will help attain its disinvestment target of Rs 40,000 crore for this fiscal.
Top Section
Explore Business Standard