Power Finance's $1 billion share sale fully covered

Posted By: Religare
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Power Finance's $1 billion share sale fully covered
Follow-on- Public offer (FPO) by Power Finance Corporation Ltd. (BSE: PFC), an Indian financial institution, is fully subscribed on the third day of the offer that started on May 10, 2011.

This issue includes 172, 165, 005 fresh equity shares with 57, 388, 335 shares of Govt. of India. Govt., planning to raise Rs. 40, 000 crore through the divestment of their stakes in various companies, holds about 89 per cent in PFC.

The price band is fixed at Rs. 193-203 per share with a discount of 5 per cent for the retail investors and eligible employees.

Through this issue the company planned to raise Rs. 4700 crore; 15 per cent of which will be utilized in augmenting the capital for future requirements and to meet the strict capital adequacy norms. With this issue Govt. will divest 15% of its stake in the company including 10% divestment during IPO launch in March, 2007.

PFC provides financial assistance to the power projects across India for generation, transmission and distribution. The financial assistance is also extended to renovation, modernization and upgradation (RM&U) projects.

PFC is also the nodal agency for the implementation of Ultra Mega Power Projects (UMPP) in India.

Indian Govt. had put greater emphasis on the power generation sector; the 11th five year plan targeted installed generation capacity addition of 78, 700 MW and 100, 000 MW addition during 12th five year plan (2012-17) to provide electricity to all by 2012.

Read more about: pfc, bse, nse, fpo
Story first published: Friday, May 13, 2011, 12:32 [IST]
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