SAIL to file draft prospectus by January for FPO

State-owned Steel Authority of India Ltd (SAIL) would file draft prospectus with Sebi by January for a follow-on public offer (FPO), Chairman C S Verma said here today.

SAIL has appointed merchant bankers to manage the FPO, Verma told reporters on the sidelines of a programme commencing work for a wagon-manufacturing unit at Kulti, being jointly set up by the Indian Railways and SAIL.

"The company will file draft Red Herring Prospectus by January-end," Verma said.
    
The state-run steel major hopes to raise Rs 8,000 crore from the first phase of the 20 per cent share sale programme. In the first phase, the government plans to divest 5 per cent of its stake in the company, while the steel giant will issue additional shares equivalent to a 5 per cent stake.
    
Another 10 per cent stake will be sold under the second phase of the FPO, the timing of which will be decided later.
    
He said that a Rs 70,000-crore capacity expansion programme of SAIL was underway. Work for Rs 12,000 crore had been completed and orders amounting to Rs 49,000 crore were already placed.
    
SAIL's capacity would go up to 24 million tonne (mt) by 2013 from the present 14 mt, he said adding that in the second phase, the capacity would be ramped up to 60 mt by 2020.
    
On SAIL's joint venture with Posco, he said the detail project report, which was scheduled to come up at Bokaro, was on the verge of completion.
    
However, Verma said that there was no joint venture proposal with the world's largest steel-maker ArcelorMittal.
    
Its proposed joint venture with Kobe Steel of Japan was scheduled to come up at Durgapur, he said.
    
Union Steel minister Virbhadra Singh, who was also present at the event, said that India's steel production capacity would go up to 120 mt by 2012 from the existing 70 mt.