India’s Reliance Power to spin off 10 pct in nation’s biggest IPO

                                                                                         

MUMBAI (AFP) — India’s Reliance Power Ltd announced on Wednesday it will spin off a 10.1 percent stake in an initial public offering that is expected to be the country’s biggest-ever IPO.

The IPO could raise between 2.8 billion and three billion dollars, outstripping the 2.25 billion dollar listing of Indian real estate giant DLF last June, media reports said.
Reliance Power, a unit of the Bombay Stock Exchange-listed Reliance Energy Ltd, has filed a prospectus for the issue of 1.3 billion shares with market authorities, a company statement said.

Shares of Reliance Energy, India’s second largest utility by market capitalisation, have surged 424.2 rupees or 41.3 percent in the past week, after media reports surfaced that its subsidiary Reliance Power would stage the IPO.

“The issue proceeds would be utilized for funding subsidiaries to part-finance construction and development costs of the various (power) projects,” the company statement said.

India’s Mint business newspaper earlier said the share sale was part of a plan to eventually restructure Reliance Energy into three distinct businesses in power, real estate and infrastructure.

Reliance Power won rights to develop a 4,000-MW mega power project at Sasan in the central state of Madhya Pradesh in June. Its parent, Reliance Energy, is building a 1,200-MW power plant at Rosa in northern Uttar Pradesh state.

Reliance Energy grew out of a split two years in the Reliance group that was sparked by a family feud.

Anil Ambani took control of the group’s telecom, power and finance activities while older his brother Mukesh Ambani retained the petrochemical and oil business.

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Source: IndiaRealEstateblog

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