Essar Energy, the Indian energy arm of the Ruia-controlled Essar Group, raised £1.27 billion in an initial public offer (IPO) at the London Stock Exchange (LSE) and will join the FTSE 100, under the ticker ESSR.
Essar Energy sold 303 million shares or 23.2 per cent of the company, pricing each share at 420 pence-lower then the 450-550 pence range it had originally planned. (See: Essar Energy launches $2.5 billion IPO in LSE)
It lowered the asking price for the shares after Russian fertiliser company Uralchem scrapped its £393 million LSE listing, citing tough market conditions as well as the multi-billion dollar debt crisis of Greece that has shaken the European markets.
Prashant Ruia, vice-chairman of Essar Energy, said that the company decided to lower the price of the IPO after credit rating agencies downgraded Greece and Portugal that shook the global markets.
The raising is by an Indian company's largest ever overseas listing that will value the company at £5.4 billion on listing. Vedanta Resources' 2003 IPO had raised £507 million on the LSE that valued it at £1.12 billion.
The Essar scrip will start trading on LSE under the ticker ESSR on 7 May, a day after the UK election, and will be among the 60 largest public companies on the LSE.