Government to raise Rs.497 crore through EIL stake sale

The government Thursday said it will raise Rs.497.3 crore through divestment of its 10 percent equity stake in Engineers India Limited (EIL).

According to a statement released by the finance ministry here, the Further Public Offering (FPO) of the company that closed Wednesday was oversubscribed 2.83 times.

The FPO was launched Feb 6 for divestment of the 10 percent government of India equity holding in the company with a price band of Rs.145-150 per share of face value of Rs.5 each. A discount of Rs.6 per share was offered to the retail investors.

Out of 3.36 crore shares which were offered, bids were received for 9.53 crore share, thus the issue was oversubscribed 2.83 times, the finance ministry said.

In the investor category-wise bids - the Qualified Institutional Buyers (QIBs) portion was subscribed 3.93 times and the retail individual investors 2.5 times.

"With the issue price being fixed at Rs.150 per share, the government would receive Rs.497.3 crore approximately towards disinvestment proceeds," the statement said.

With this divestment, the Indian government's holding in EIL will come down to 70.4 percent.