The share sale would see government offloading 10 per cent of its stake in the steel maker, while the company will raise fresh equity in the same proportion.
State-run Steel Authority of India on Tuesday said it will file the red herring prospectus in May for its forthcoming follow-on public offer, which is expected to hit the market in the first quarter of the next fiscal.
SAIL chairman Sushil Kumar Roongta had recently said the company was looking to issue additional equity in the market.
The government's aim is to ensure it gets to its Rs 40,000-crore (Rs 400-billion) target from disinvestment proceeds before the end of 2010-11.
Steel Authority of India Ltd (SAIL) is looking for ventures into analogous sectors. While the state-run company is going for a follow-on public offer (FPO) in early 2011, it is looking at some aggressive expansion plans, and mergers and acquisitions as well, said Chandra Shekhar Verma, chairman and managing director.
Deutsche Bank bid the lowest--which was promptly matched by five others--according to the sources. They said DB quoted 0.00000000001 per cent of the issue size as bankers' fee. That works out to 80 paise. The banks were apparently willing to waive the fee altogether, but what deterred them was that UBS was recently disqualified on technical grounds from the NTPC FPO as it had quoted nil fee.
Move aimed at avoiding crowding of public issues during the Centre's mega disinvestments in coming months.
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