Punjab Sind Bank to consider participation of anchor investors for its IPO (31-Aug-2010)
Indian-Commodity : Ipo : Punjab Sind Bank to consider participation of anchor investors for its IPO
Second government-run entity after Coal India, State-run Punjab & Sind Bank, may consider the participation of anchor investors for its initial public offer (IPO), through which the public sector lender targets to raise up to Rs 600 crore. Punjab & Sind Bank is the only unlisted state-run lender.
The bank proposes to issue up to four crore equity shares of Rs 10 each for cash at price to be discovered through a 100% book building process. The issue is expected to hit capital market by the end of November or early December depending on regulatory clearances.
The bank may allocate up to 30% of the qualified institutional portion, to anchor investors, on a discretionary basis, as per the lender's draft red herring prospectus (DRHP) filed with the capital market regulator SEBI. As per the DRHP, the bank has reserved 50 per cent of the net issue for qualified institutional buyers.
The government would offload about 17.9% of its stake through IPO and post offer its holding would come down to about 82%. Currently, the government owns 100 per cent stake in the bank and is the only unlisted bank among 19 nationalized banks in the country.
Anchor investors are those investors, who buy shares of the company before the launch of the public issue. Anchor investors, who cannot be a promoter of the issuer company, can be allocated as much as 30% of the portion reserved for qualified institutional buyers. Also, such investors must bid for at least Rs 10 crore worth shares.
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