Abhijeet Power files DRHP for Rs 1375 cr IPO

Abhijeet Power has filed a draft red herring prospectus with the Securities and Exchange Board of India (SEBI) for an initial public offering (IPO) of its equity shares of face value of Rs 10 each for cash at a price to be decided through the book-building process and aggregating to Rs 1375 crore. The promoters of the company are Manoj Jayaswal, Abhijeet Mining Limited and Corporate Ispat Alloys Limited.

The issue comprises a reservation of equity shares aggregating up to Rs 10 crore for eligible employees.  The issue less the employee reservation portion constitutes the net issue to the public. The Nagpur-based firm joins rivals Avantha Power, Ind-Barath, Sterlite Energy and Jindal Power that together plan to mop up about USD 3.5 billion in 2011 from the Indian primary market where energy firms raised USD 608 million in 2010 through primary share offers, according to data from Thomson Reuters. The company is considering a pre-IPO placement of up to 333,333,333 equity shares with various investors for an amount not exceeding Rs 500 crore. The pre-IPO placement will be at the discretion of the company and at a price to be decided by the company. The company will complete the issuance and allotment of equity shares pursuant to the pre-IPO placement prior to filing of the red herring prospectus with the RoC. If the pre-IPO placement is completed, the issue size offered to the public would be reduced to the extent of such pre-IPO Placement, subject to a minimum Issue size of 10% of the post-Issue paid-up equity share capital being offered to the public. A discount of up to 10% to the issue price may be offered to eligible employees. The price band, the eligible employee discount and the minimum bid lot size in relation to the issue will be decided by the company, in consultation with the global coordinators and book running lead managers and the book running lead managers and advertised at least two working days prior to the issue opening date. The equity shares offered through the issue are proposed to be listed on Bombay Stock Exchange Limited (BSE) and National Stock Exchange of India Limited (NSE).  Global coordinators and book running lead managers to the issue are DSP Merrill Lynch Limited (BoFA Merrill Lynch) and Enam Securities Private Limited. Book running lead managers to the issue are Axis Bank Limited, IDFC Capital Limited, SBI Capital Markets Limited and UBS Securities India Private Limited.  (With inputs from Reuters)