State-run Rashtriya Ispat Nigam Ltd (RINL) is divesting a 10 per cent stake, amounting to 488.98 million shares, through an initial public offer (IPO).
The IPO is part of the government's disinvestment plan to raise Rs30,000 crore during the current financial year through selling of stakes in state-run companies.
RINL has submitted draft red herring prospectus (DRHP) with market regulator Securities and Exchange Board of India (SEBI) for the stake sale.
''The objects of the offer are to carry out disinvestment of 488,984,620 equity shares by the selling shareholder and to achieve the benefits of listing the equity shares on the stock exchanges. Our company will not receive any proceeds from the offer and the proceeds shall go to the selling shareholder (government),'' RINL said in the DRHP.
The offer comprises a net offer to public of 440,086,158 equity shares and a reservation of 48,898,462 equity shares for subscription by eligible employees. Together the offer constitutes 10 per cent of the post offer paid-up equity share capital of the company and the net offer to the public will constitute nine per cent of the post offer paid-up equity share capital of the company, RINL said in its filing.
The pricing of the shares will be through the book-building route and the price band and the minimum bid lot will be decided by the selling shareholder and the company in consultation with the book running lead managers and published at least two working days prior to the date of offer opening.