Finance Ministry invites bids for appointment of lead managers for CIL IPO

The Finance Ministry has invited bids from eligible parties for appointment as lead managers for Coal India Ltd's (CIL) initial public offering. The bids would have to be submitted by 3 May.

For the facilitation of CIL's listing the government is said to be considering divestment of 10 per cent paid-up equity share capital of CIL through an IPO. CIL is a Navratna public sector undertaking.

Employees of CIL and its eight subsidiaries would be eligible for 1 per cent of the public offering which is reserved for them, according to the divestment department.

The government plans to select and appoint six merchant bankers to serve as book running lead managers (BRLMs).

CIL's paid up equity capital is fully held by the government and as of March 2010 it stood at Rs6316.36 crore.

According to analysts, the IPO will most likely hit the market in July or August.

Bidders should have handled at least one domestic equity issue of Rs500 crore or more in the last three financial years to qualify for the bidding process.

The cabinet has not yet given its nod for the divestment of the company's equity. The company had been asked to list its shares within 3 years after being conferred the Navaratna status.