CCEA likely to take up Power Grid FPO tomorrow
The proposal is likely to be considered during the CCEA meeting tomorrow. The follow-on public offering (FPO) will comprise 13 per cent fresh equity by the public-sector company and 4 percent stake sale by the central government.
November 06, 2013 / 20:29 IST
The Cabinet Committee on Economic Affairs may tomorrow take up the power ministry's proposal for a follow-on public offer of state-run Power Grid Corporation of India, which is expected to mop up over Rs 7,500 crore.
According to sources, the proposal is likely to be considered during the CCEA meeting tomorrow. The follow-on public offering (FPO) will comprise 13 per cent fresh equity by the public-sector company and 4 percent stake sale by the central government. The company will issue fresh 60.18 crore shares through the offer and a part of it would be reserved for the employees. Meanwhile, the Department of Disinvestment has invited applications from merchant bankers for the proposed FPO. Also Read: PowerMin awaits comments on hiving off POSOCOThe government proposes to dilute 4 percent stake, or 18.51 crore shares, out of its current 69.42 percent holding. At current prices, the government could get over Rs 1,782 crore from the disinvestment, while the company would get over Rs 5,793 crore from the sale of fresh equity. This would be the second follow-on offering from Power Grid, which sold a 10 percent stake along with a similar stake divested by the government in November 2010 at an issue price of Rs 90 a share. The company hit the capital market with its initial public offering in October 2007. Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
