Tata Steel FPO anchor book subscribed nearly 8 times

The anchor book of Tata Steel's follow-on public offer (FPO) was subscribed nearly eight times on Tuesday, reports CNBC-TV18 quoting sources. Anchor book opens one day before the issue opens for other investors. Thirty percent of qualified institutional investors' reserved portion i.e. 83,25,000 equity shares (USD 112 million) is reserved for anchor book.

 Anchor investors include Fidelity, Blackstone, Capital International, Goldman Sachs and Govt of Singapore.

Tata Steel's FPO will open for subscription on January 19. The total 5.7 crore equity shares issue comprises a net issue to the public of 5.55 crore shares and a reservation of 15 lakh shares for subscription by eligible employees.

Tata Steel has a steel production capacity of approximately 27.2 mtpa. According to WSA, the company was the seventh largest steel company in the world in terms of crude steel production volume in 2009. The company is also one of the most geographically diversified steel producers, with operations in 26 countries and a commercial presence in more than 50 countries.

The company aims to raise around Rs 3,385.8-3,477 crore through the issue at a price band of Rs 594-610 a share. Rs 1,800 crore of the issue proceeds will be used for Jamshedpur unit and Rs 1,000 crore for repay debt.

The steel major is also open to investing part of its upcoming share sale proceeds in a project of Australian miner Riversdale.