CMC offer opens on Feb 23

The CMC offer for sale, in which the government of India will divest its entire 26.25 per cent stake in the company, will open on February 23 and end on February 28. The price band, though, will be kept under wraps till the day before the bid opens.

"The price will not be revealed till the day before the sale opens, but in any case the market price will serve as a benchmark for the pricing," said Naina Lal Kidwai, vice chairman and managing director of HSBC Securities and Capital Markets, which is the book-running lead manager for the issue.

Kidwai refused to comment on whether the offer will come with differential pricing for small retail investors.

The offer is for the sale of 39,76,374 equity shares of face value Rs 10 each, which represents 26.25 per cent of the fully diluted post offer paid-up capital of the company.

The offer is being made through a 100 per cent book building process wherein up to 50 per cent of the offer shall be allocated to qualified institutional buyers on a discretionary basis.

Further, not less than 25 per cent offer will be available for allocation on a proportionate basis to non-institutional bidders and the remaining 25 per cent will available to retail investors.

The CMC roadshow, which flagged off the beginning of a IPO/divestment season in the markets, saw participation from both stakeholders Tata Consultancy Services/Tata Sons (51.3 per cent) and the ministry of disinvestment.

The joint secretary, ministry of disinvestment PV Bhide said: "We are aiming for a larger shareholder base for the company, getting smaller shareholders involved in company will help ensure better corporate governance."