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The government has fixed a price band between Rs 85 and Rs 90 for the Follow-on Public Offer (FPO) of state-owned power transmission company Powergrid Corp (PGCIL).
The band was approved by the company’s board in its meeting today, Powergrid told Bombay Stock Exchange (BSE) in a filing.
The public issue will be launched on December 3 and fetch Rs 7,480 crore at the current price of Rs 95.05 a share. The date and pricing of the offer was decided in a meeting of the Empowered Group of Ministers (EGoM) headed by Finance Minister P Chidambaram.
The company will raise 13% fresh equity while the government will offload 4% of its stake through the FPO. The company will issue fresh 601.8 million shares through the offer. Of this, around 2.4% will be reserved for employees.
At today’s market price, the company would garner close to Rs 5,720 crore through the offer while the government will raise around Rs 1,760 crore, inching a step closer to realizing its disinvestment target of Rs 40,000 crore for the current financial year.
Powergrid’s Initial Public Offer (IPO) was launched in October 2007. The company had sold 10% stake along with divestment of an equal stake by the government in its first FPO in November 2010.
