Gail floor price set at Rs 185

The government set a floor price of Rs 185 per share for the proposed public offering of Gail India Ltd. The government will offload 84 million equity shares, constituting around 10 per cent of the total paid-up capital, of the company.

Announcing the floor price, Disinvestment Secretary Dhirendra Singh said retail investors would be eligible for a 5 per cent discount as compared to the price offered to institutional bidders.

The Gail public offer is scheduled to open on February 27 and will close on March 5.

Shares would be offered to qualified institutional buyers, non-institutional investors and retail bidders through a book building process, Singh added.

The public sector company's share price closed at Rs 196 on the Bombay Stock Exchange today, down 5 per cent from yesterday's close.

Singh said the government was not concerned over the current dip in share prices and added that the market would stabilise soon.

After the public offering, the government's stake in Gail would come down to 56 per cent.

Gail is the fifth public sector company which will tap the market in the current disinvestment round along with IPCL, CMC, IBP and Dredging Corporation of India.

Oil and Natural Gas Corporation is also slated to enter the markets soon.