Essar launches $2.5b London energy IPO
Friday, 23 April 2010
MUMBAI, Apr 22 (Reuters): Indian conglomerate Essar Group Thursday launched an initial public offer of shares of its energy and power businesses to raise about $2.5 billion in a London listing, three sources with direct knowledge of the matter said.
The group is selling a 20-25 per cent stake in Essar Energy to institutions as it looks to tap new investors to fund its ambitious expansion plans, including the acquisition of coal mines to expand power capacity, and the development and exploration of oil and gas blocks.
New shares will be issued to institutions in a range of 450-550 pence a share in an offering that will close on April 29, the sources said. The sources did not wish to be named as they were not authorised to speak with the media.
Listing on the London Stock Exchange is expected in the first week of May, one of the sources said.
The group's energy and power operations, including four existing plants with a total installed capacity of 1,220 megawatts, will have a market capitalisation of $9.5-$11 billion upon listing, the sources said.
The offering to institutions would help expansion plans at Essar, controlled by billionaire brothers Shashi and Ravi Ruia and whose interests span telecoms and energy to steel and shipping.
After the sale, Essar Energy will be listed on the London Stock Exchange and will be considered for inclusion in the FTSE 100 index, the company has said previously.
Essar Energy is incorporated in the UK, and has its registered office in London and its head office in Mauritius.
The group is selling a 20-25 per cent stake in Essar Energy to institutions as it looks to tap new investors to fund its ambitious expansion plans, including the acquisition of coal mines to expand power capacity, and the development and exploration of oil and gas blocks.
New shares will be issued to institutions in a range of 450-550 pence a share in an offering that will close on April 29, the sources said. The sources did not wish to be named as they were not authorised to speak with the media.
Listing on the London Stock Exchange is expected in the first week of May, one of the sources said.
The group's energy and power operations, including four existing plants with a total installed capacity of 1,220 megawatts, will have a market capitalisation of $9.5-$11 billion upon listing, the sources said.
The offering to institutions would help expansion plans at Essar, controlled by billionaire brothers Shashi and Ravi Ruia and whose interests span telecoms and energy to steel and shipping.
After the sale, Essar Energy will be listed on the London Stock Exchange and will be considered for inclusion in the FTSE 100 index, the company has said previously.
Essar Energy is incorporated in the UK, and has its registered office in London and its head office in Mauritius.