The follow-on-public offer (FPO) of the state-run transmission utility saw bids coming in for nearly 530 crore shares, or 6.74 times the 78.70 crore shares on offer.

"The meeting to fix the issue price for Power Grid shares is scheduled on December 10," a source said.

The price band for the FPO was Rs 85-90 apiece and the number of bids at cut off price was over 56.67 crore, as per data available on bourses. Of the shares offered in the FPO, the retail investors portion was subscribed 2.17 times, the qualified institutional buyers bid for 9.09 times and non-institutional buyers bid for 9.70 times the shares on offer.

Retail investors would be alloted shares at a discount of Rs 4.50 apiece over the issue price.

The sale of 78.70 crore shares, or 17 percent stake, could fetch around Rs 7,083 crore at the upper end of the price band. The government is selling 18.51 crore shares, while the company is issuing fresh 60.18 crore shares through the offer.

About 2.4 percent of fresh shares are reserved for employees. With fresh share issue, the company may garner close to Rs 5,416 crore at upper price band, while the government may receive around Rs 1,666 crore by diluting its stake.
    
Post-issue, the government holding in the company would come down to 57.89 percent from the present level of 69.42 percent.
    
Power Grid shares closed at Rs 98.90, up 2.86 percent from previous close on BSE on Friday. The Cabinet last month cleared the FPO which comprises 13 percent fresh equity by the company and 4 percent stake sale by the central government.
    
This is the second follow-on offering from Power Grid, which sold a 10 per cent stake along with a similar stake divested by the government in November 2010 at an issue price of Rs 90 a share. The company hit the capital market with an initial public offering in October 2007.
    
So far in the current fiscal, the government has raised over Rs 1,300 crore through minority stake sale in PSUs. It has set a target of Rs 40,000 crore from disinvestment in the current fiscal.

(Agencies)

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