Mumbai: India’s government said it will sell a 5 per cent stake in top power producer NTPC Ltd through a stock market auction, with a greenshoe option to sell another 5 per cent in a deal that could raise up to $2.2 billion (Dh8.08 billion).
The share sale, which will take place this week, is one of a number of partial stake sales planned to help New Delhi meet its fiscal deficit target of 3.2 per cent of gross domestic product.
The government, which owns nearly 70 per cent of NTPC, said it has set a floor price of Rs168 (Dh9.64) apiece for the auction on Tuesday and Wednesday. In the base offer to sell a 5 per cent stake, it will sell up to 412.27 million shares and an equal number of shares as part of the oversubscription option, according to a regulatory filing.
The government aims to raise Rs725 billion ($11.4 billion) through stake sales during the year to March 2018, and has raised about Rs93 billion from such divestments so far.
The NTPC sale will be open for funds on Tuesday, while retail investors will be able to bid on Wednesday. Retail investors will receive shares at a 5 per cent discount to the cut-off price.
