PIB Press Release dated 22 July 2010- Follow-on Public Offer for Power Grid Corporation of India Limited
The Cabinet Committee on Economic Affairs today approved the Follow-on Public Offer (FPO) of Power Grid Corp.of India Ltd. (PGCIL) of 84,17,68,246 (Eighty Four Crore Seventeen Lakh Sixty Eight Thousand Two Hundred Forty Six) equity shares of Rs. 10 each, constituting 20% of existing paid-up capital. This comprises fresh issue of 42,08,84,123 equity shares (10% of existing paid-up capital) and offer for sale (Disinvestment) of 42,08,84,123 equity shares (10% of existing paid-up capital) by selling shareholder i.e. the President of India.
Additional resources generated through the issue of an FPO will be utilized by PGCIL in its investment programmes.
PGCIL will be required to approach the capital market for raising funds through issue of fresh equity for funding its investment programme commencing from Financial Year 2010-11. The requirement of funds to be raised through issue of fresh equity for funding the capital expenditure for the balance Eleventh plan period will be in the order of Rs. 4,200 crore. The fresh issue of FPO would result in the PGCIL meeting with the CERC allowed norms of 30% equity contributions during the Eleventh Plan period.
PGCIL went for a maiden Initial Public Offering (IPO) of equity shares consisting of issue of fresh equity shares with 10% of paid-up capital and disinvestment of Government of India equity holding of 5% of paid-up capital in October 2007 through the book building process and the issue was subscribed 64.50 times. The shares of the PGCIL got listed in the National Stock Exchange and Bombay Stock Exchange on 5 October 2007. PGCIL raised Rs. 2,984 crore at the issue price of Rs. 52 per share out of which Rs. 995 crore was paid to the Government of India towards the disinvestment proceeds and the balance amount, after meeting the issue expenses, was utilized for capital expenditure of identified projects during the Financial Year 2007-08 and 2008-09.
Link is being provided for easy reference to PGCIL website: