PME Power files draft papers for initial public offer

Transformer-maker PME Power Solutions today filed preliminary papers with market regulator Sebi for an initial share sale, through which the firm expects to raise up to Rs 300 crore.

The proceeds would be mainly utilised for expansion activities, as well as to repay debts.

PME Power Solutions (India) Ltd plans to issue over 1.14 crore equity shares, each having a face value of Rs 10, according to its Draft Red Herring Prospectus (DRHP).

Market sources said the initial share sale of PME Power is expected to mop up about Rs 250 to 300 crore. The IPO is likely to hit the market toward the end of this year, they added.

The funds raised from the share sale would be used for "setting up of manufacturing facilities at Moradabad, in Uttar Pradesh, aimed at enhancing our transformer production capability up to 315 MVA at 400 KV class."

Further, the proceeds would be utilised to repay existing borrowings and for general corporate and other purposes, as per the DRHP.

The book running lead managers for the issue are Edelweiss Capital and Imperial Corporate Finance and Services Pvt Ltd.

The IPO would constitute 25% of the company's fully diluted post issue paid-up share capital.

PME manufactures power and distribution transformers up to 40 MVA of 132 kv class. It is also into transmission and distribution related activities.