A two-tranche follow-on-public (FPO) offer in Hindustan Copper is expected to be cleared by the Cabinet Committee on Economic Affairs (CCEA) in the next fortnight.
“The government will disinvest 10 per cent equity and 10 per cent fresh shares will be issued,” said Shakeel Ahmed, chairman and managing director, Hindustan Copper. The issue is likely to generate Rs 4,000-5,000 crore and would follow the book building route.
Without elaborating on the pricing, Ahmed said that lessons had been learnt from previous FPOs. “The pricing will be win-win for all investors including retail,” he said. Some shares would be reserved for employees. With disinvestment round the corner, the PSU has chalked out a roadmap that entails major expansion through the organic and inorganic route.
Copper ore production would be enhanced more than three-fold from the current level of 3.6 million tonne to 12 million tonne in the next five years. The major expansion would be in the Malunjkhand open pit mine.
Ahmed said, the project would cost around Rs 2,500 crore, and has been approved by the board. Hindustan Copper could also go for partnership, not necessarily a joint venture model. Khetri underground mines would be expanded from one million tonne to three million tonnes while closed mines in the Singhbhum copper belt would be re-opened.
The company is eyeing acquisition of deposits in geographies outside India. However, no breakthrough had been made as yet, said Ahmed. Setting up port-based modern smelting and refining facilities in India and other countries, was also being considered.
Ahmed said, the company was open to alliance and long-term partnerships with global mining companies through joint ventures, but not for existing mines/leases.
In Rajasthan, Hindustan Copper has bagged a prospecting licence for a mine, which has reserves of close to 85 million tonnes.
