NMDC follow-on offer opens today

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The follow-on public offer of NMDC , a navratna public sector undertaking and the largest iron ore producer by volume in India during the last three fiscal years (according to a certificate of the Federation of Indian Mineral Industries dated as of February 8, 2010), opened for subscriptions today.

This public offering of 332,243,200 is through an offer for sale by the President of India, acting through the Ministry of Steel, Government of India for cash at a price determined by the book building process. The offer comprises a net offer to the public of 330,500,000 equity shares of face value Re 1 each and a reservation of 1,743,200 equity shares for purchase by eligible employees. The offer shall constitute upto 8.38% of the post offer paid-up equity share capital of the company. The offer will close on March 12, 2010.

The price band for the issue has fixed at Rs 300-350 per share.

A discount of 5% to the offer price determined pursuant to the completion of the book building process shall be offered to retail individual bidders and eligible employees. The excess amount paid at the time of bidding shall be refunded to the retail individual bidders and eligible employees.

Up to 50% of the net offer of the FPO will be available for allocation on a proportionate basis to qualified institutional buyers (QIBs). 5% of the QIB portion shall be available for allocation on a proportionate basis to Mutual Funds only. The remainder of the QIB Portion shall be available for allocation on a proportionate basis to QIBs and Mutual Funds, subject to valid Bids being received from them at or above the offer price. Further, not less than 15% of the Net Offer will be available for allocation on a proportionate basis to Non-Institutional Bidders subject to valid Bids being received from them at or above the Offer Price. Further, not less than 35% of the Net Offer will be available for allocation on a proportionate basis to Retail Individual Bidders, subject to valid Bids being received from them at or above the Offer Price. Further, 1,743,200 Equity Shares shall be made available for allocation on a proportionate basis to the Eligible Employees, subject to valid Bids being received from them at or above the Offer Price in the Employee Reservation Portion. Any Bidder (other than QIBs) may participate in this Offer through the ASBA process by providing the details of their respective bank accounts in which the corresponding Bid amounts will be blocked by Self Certified Syndicate Banks ("SCSBs").

The book running lead managers are UBS Securities India Private Limited, Citigroup Global Markets India Private Limited, Edelweiss Capital Limited, Kotak Mahindra Capital Company Limited, Morgan Stanley India Company Private Limited and RBS Equities (India) Limited.

The offer shares are already listed on the BSE, the NSE, the BSEL, the MSE, the CSE and the DSE. BSE is the Designated Stock Exchange for the Offer.