Govt sets EIL FPO price band at Rs 270-290

The government today set Rs 270-290 as the price band for the follow-on public offer (FPO) of state-run Engineers India Ltd (EIL).

A group of ministers headed by Finance Minister Pranab Mukherjee set the price band at a discount to Friday's closing of Rs 337.65 for the sale of the government's 10 per cent shareholding in the engineering consultancy firm.

The government would raise Rs 909.63 crore at the lower end of the price band and Rs 977.01 crore at the upper end, sources said.

EIL's public offer of 33.69 million equity shares will open on July 27 and close on July 29 for qualified institutional buyers and on July 30 for the rest (retail and HNIs).

The government holds 90.4 per cent stake in EIL, which provides design and engineering services for petroleum, power and fertiliser companies. Post FPO, government holding in EIL will fall to 80.4 per cent. Sources said 712,000 equity shares had been reserved for company employees who would be entitled to the discount that retail investors would get in the offer that was being done through a book building route.

Half of the net offer of 32.98 million shares (after deducting employees quota) has been reserved for qualified institutional buyers and retail investors will get up to 35 per cent of 11.54 million shares.