PFC stake sale: govt sets floor price at Rs 254

Is likely to mobilise around Rs 1,676 crore through the divestment

The government has set a floor price of Rs 254 per equity share for divestment of 5% stake in Power Finance Corporation (PFC) on July 27.

"...The floor price of the offer in terms of the Sebi OFS Circular shall be Rs 254 per equity share of Power Finance Corporation Ltd," Power Finance Corporation said in a BSE filing.

At the floor price, the government is expected to mobilise around Rs 1,676 crore through the divestment.

Shares of PFC closed at Rs 259.55 apiece on the BSE yesterday.

At present, the government holds 72.80% equity in Power Finance Corporation. After the sale, government's holding will be reduced to 67.80%.

PFC's offer for sale (OFS) will commence at 0915 hrs and will close at 1530 hrs on July 27.

The Department of Disinvestment has set a Rs 69,500-crore disinvestment target in the current fiscal, of which Rs 41,000 crore would come from minority stake sale and Rs 28,500 crore from strategic stake sale.

As per the government's disinvestment plan, the DoD would sell minority stake in PSUs through an offer for sale in which 20% of the issue size is reserved for retail investors and 25% for mutual funds and domestic insurance companies.

The remaining portion is left for institutional investors, which are usually lapped up mostly by domestic financial institutions and foreign funds.

The government in this fiscal has been able to sell stake in only one PSU, REC.