Power Grid Issue

Hello sir I want to know about the issue of sale of Power Grid Corporation shares so please provide me information about the same.

[Shaleen]

The government fixed the issue price for the sale of Power Grid Corporation shares at Rs 90 apiece, the upper end of the band, which would fetch about Rs 7,000 crore.

News about the sale of Power Grid Corporation shares

The follow-on public offer (FPO) of the state-run transmission utility bids for 530 crore shares, or 6.74 times the 78.7 crore shares on offer.

Retail investors and eligible employees get a discount of Rs 4.50 a share on the issue price, Power Grid said in a filing to the BSE.

The price band for the FPO was Rs 85-90 apiece.

The Cabinet approved the FPO last month.

The offer comprised 13% fresh equity by the company and 4% stake sale by the central government.

The government will get about Rs 1,600 crore from selling 18.51 crore shares, while Power Grid will raise close to Rs 5,400 crore from its offer of 60.18 crore new shares.

After the issue, the government's holding in the company will come down to 57.89% from the present level of 69.42%.

Qualified institutional buyers bid for 9.09 times the shares reserved for them and non-institutional buyers bid for 9.7 times the shares they were offered.

Power Grid shares closed at Rs 98.90 on the BSE today, up 2.86%.

This was Power Grid's second FPO. The company and the government each sold a 10% stake in November 2010 at Rs 90 a share.