Public sector company Oil and Natural Gas Corporation (ONGC) may file papers for a Rs 12,000 crore share sale by early next month, a senior company official said on Tuesday.
“We have been asked (by the government) to be prepared for the follow-on public offer (FPO). The company board is meeting on August 29 to approve the consolidated accounts. Thereafter, the red herring prospectus (RHP) will be filed with (market regulator) SEBI,” he said. The RHP for the FPO may be filed by early next month, he added.
“We are prepared for the FPO and we are awaiting signal from the Department of Disinvestment,” the official said.
The board on August 29 will approve the RHP which will incorporate financial results for the April-June quarter.
The government plans to sell 5 per cent of 427.77 million shares through the FPO which at today’s trading price of Rs 280 a share will fetch over Rs 11,977 crore.
The FPO was originally planned for 2010-11 fiscal but was deferred to April 5 as the company did not have adequate number of independent directors on its board to meet the SEBI’s listing norm. It was then scheduled for July 5 but was again deferred due of weak market conditions.
Post—FPO, the government’s stake in ONGC would come down to 69.14 per cent from the current 74.14 per cent.
The government’s ad—hoc subsidy sharing mechanism has cast a shadow on ONGC’s share sale during recent months. During April-June quarter, upstream firms paid one-third of the over Rs 43,000 crore revenue loss on fuel sales.