Power Ministry to soon float Cabinet note for Power Grid FPO

Power Ministry will soon float a Cabinet note for a follow-on public offer of state-run Power Grid Corp to raise 13 per cent fresh equity and about 4 per cent share sale by the central government.

"We have prepared the note on the Power Grid FPO, will float it anytime soon," a Power Ministry official said.

He said the company will raise 13 per cent fresh equity and the government will disinvest about 3-4 per cent of its stake in the central transmission utility through the FPO.

Calculated on the basis of current market price (Rs 99 apiece), the company is expected to mop up over Rs 4,100 crore through the FPO.

At present, the government holds 69 per cent stake in the public sector unit.

The funds raised are expected to be utilised towards its expansion plans, including power transmission to the tune of 75,000 MW by 2017.

This would be the second time that Power Grid would be going for FPO after doing the same in November 2010. The company raised 10 per cent equity and the central government sold as much share in the state-owned firm during that time.

The company had hit the capital market in October, 2007, with its maiden public offer (IPO).

Power Grid shares were trading at Rs 99 per scrip in the afternoon trade on the BSE.