Mumbai: India's number one IT company, Tata Consultancy Services (TCS) has finally filed its draft prospectus for initial public offer (IPO) with the Securities and Exchange Board of India (SEBI) yesterday.
The total number of shares on offer is 5.5 crore (55,452,600). This is divided into two lots. The first lot of 2.27 crore share are fresh shares being issued by TCS Ltd. The rest are shares on offer for sale from Tata Sons and other shareholders of TCS. The issue also has provisions of a greenshoe option of 83.17 lakh shares.
The face value of the shares are expected to be Re1.The issue would be entirely on the book building method. The price band in which the shares would be offered and the actual dates of the offer would be announced after SEBI's approval of the prospectus. The price band and the timing of the issue will depend on te budget and market conditions.
Sixty per cent of the offer is proposed to be reserved for qualified institutional buyers. Not less than 16 per cent is being reserved for non-institutional buyers and the remaining would be allocated on a pro-rata basis to retail investors. The issue has full eligibility for participation by foreign institutional investors.
Around 55.45 lakh shares have been reserved for employees of TCS Division, TCS Ltd and Tata Sons, according to sources. The proceeds from the issue would be primarily used to pay Tata Sons for the transfer of ownership and the remaining proceeds would be deployed for general corporate purposes.
The issue is to be listed on Bombay Stock Exchange and National Stock Exchange. DSP Merrill Lynch and JM Morgan Stanley are the lead running book managers to the issue. J.P. Morgan is also part of the syndicate of lead running book managers. Karvy has been mandated to be the Registrar and Adfactors would be handling the public relations for the issue.