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| SJVN public offer could be launched next year: CMD |
| BS Reporter / New Delhi Nov 16, 2009, 01:11 IST |
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The Initial Public Offer (IPO) of Satluj Jal Vidyut Nigam Ltd (SJVN), the state-owned hydro power producer, is likely to hit the market in the next financial year.
“We are in the process of appointing independent directors. After which, we will approach the Securities and Exchange Board of India (Sebi). The entire process may take another six months. The issue might be spilled to the next financial year,” said H K Sharma, chairman and managing director. He was speaking at the sidelines of a conference of state power ministers.
By Sebi norms, for a company having an executive chairman to launch a public issue, independent directors must constitute half its board.
The government had approved a 10 per cent sale of its stake in SJVN. Currently, the government holds 75 percent stake in the company, the rest being owned by the Himachal Pradesh government. After the IPO, the government’s shareholding in the Miniratna PSU would come down to 65 per cent.
The company, with an authorised share capital of Rs 4,500 crore, plans to offer 310 million shares of Rs 10 face value each, to fetch over Rs 1,200 crore from the capital market in its maiden public issue.
This would be the second power sector PSU to hit the stock market in the second round of the disinvestment drive. Earlier this year, NHPC, the largest hydro power producer, announced an IPO earlier this year to raise over Rs 6,000 crore from the market.
Meanwhile, state-run NTPC on Sunday said it would file the draft prospectus for its follow-on public offer with market regulator Sebi in December., a senior company official said.
“We will have to file the Draft Red Herring Prospectus with Sebi next month...We plan to hit the market by February,” CMD NTPC R S Sharma told reporters on the sidelines of a power event.
The Cabinet Committee on Economic Affairs had last month given approval for sale of 5 per cent government stake in the navratna PSU.
After the 5 per cent stake dilution, the government’s holding in NTPC would come down to 84.5 per cent.
The government expects to mop up about Rs 8,100 crore from the market through this FPO, at the current market conditions.
The proceeds from the FPO would go to the investment fund that finances social sector schemes.
In 2004, NTPC had raised about Rs 2,700 crore through the Initial Public Offering when the government diluted 5.24 per cent of its stake.
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