Reliance Petroleum files draft prospectus for IPO

08 March 2006

Reliance Petroleum (RPL), promoted by Reliance Industries Limited (RIL) to execute the new export-oriented refinery project in Jamnagar, Gujarat, has filed the draft prospectus with SEBI ahead of its planned IPO.

The issue is expected to raise up to Rs8,550 crore and would be one of the largest ever in the history of Indian markets.

The company is planning to issue 180 crore shares, including the promoter''s contribution of 90 crore shares. Hence the net issue to public would be 90 crore shares. The issue is likely to be priced at a premium of between Rs35 to Rs40 per share of face value Rs10 each.

Retail investors would have the option of paying only 10 per cent of the bid amount at the time of application and the balance 90 per cent after allotment.

The project is expected to cost Rs27,000 crore, to be funded through Rs15,750 crore in debt and Rs11,250 crore in equity. The company has already entered into preliminary agreement with banks for a syndicated term loan facility of Rs6,750 crore. Between Rs4,500 crore to Rs6,750 crore would be raised from export credit agencies.

RIL has already subscribed to 270 crore shares of RPL at Rs10 each and consequently, RPL''s net worth now stands at Rs2,698 crore. RIL would subscribe to 90 crore additional equity shares during the IPO at the issue price.