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Home News Power Sector News CCEA approves Share Sale in Power Grid

CCEA approves Share Sale in Power Grid

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PGCILThe Cabinet Committee on Economic Affairs (CCEA) approved the follow-on public offer (FPO) of the public sector Power Grid Corporation of India Limited (PGCIL) of 84,17,68,246 equity shares of Rs.10 each, constituting 20% of its 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 the selling shareholder, the President of India.

Additional resources generated through the issue of an FPO will be utilized by PGCIL in its investment programmes, an official press release said.

According to the release, 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 of the XI Plan period will be in the order of Rs 4200 crore. The fresh issue of FPO would result in PGCIL meeting with the norms of the Central Electricity Regulatory Commission (CERC).

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 October 5, 2007. PGCIL raised Rs. 2984 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, the release added.

 

Source- PTI

 

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