Cairn IPO, India''s biggest, to be in Rs180-200 band

13 October 2006

Mumbai: Cairn India plans to raise as much as Rs10,000 crore (approximately $ 2 billion) through its initial public offering mostly likely in December this year.

According to its draft Red Herring prospectus filed with SEBI, the Scotland-based Cairn Energy plc's Indian arm, has proposed to offer 538.47 million new equity share of Rs10 each for cash at a premium to be decided by a 100-per cent book-building process.

The company may also grant an over-allotment option in accordance with Sebi guidelines. Cairn Energy plc will own a 69.5-per cent in Cairn India following the flotation (excluding any exercise of the over-allotment option).

Cairn India proposes to allot 60 per cent of the IPO to qualified institutional buyers on a proportionate basis; 10 per on a proportionate basis to non-institutional investors and 30 per cent to retail bidders on a proportionate basis.

The pricing is proposed to be in the range of Rs180 to Rs200 per share.

The IPO realization would be used to fund the growth of Cairn India and to acquire assets from the parent company. Cairn India will focus on exploration, development and production while the UK-based unit will concentrate on exploration.