This proposed stake sale to UK institutional investors will be used to develop the company’s energy assets
The Ruias-owned Essar Energy Ltd today announced plans to raise about $2.5 billion (over Rs11,250 crore) through an initial public offering (IPO) in the UK.
Upon completion, the promoters Ruias’ Essar Group would hold a minimum of 75% in Essar Energy, and would be listed on the London Stock Exchange (LSE), Essar Energy vice chairman Prashant Ruia said, reports PTI.
Essar Energy has initiated the process of seeking regulatory clearances in the UK for the IPO, proceeds of which would be used for expansion of its refinery, setting up more power projects and developing coal-bed-methane (CBM) and other energy assets.
Essar Energy intends to apply for its shares to be admitted to the official list of the Financial Services Authority in the UK and for trading on the LSE’s main market for listed securities.
On completion of the offer, it is expected that Essar Energy will be considered for inclusion in the FTSE 100 index.
“This will be a landmark event both for Essar Group and Essar Energy. At the time of the offer we would have already $2 billion of capital in Essar Energy. A London listing gives us an excellent platform to showcase the potential of the Indian market to the world,” Essar Energy chairman Ravi Ruia said.
Prashant Ruia said, “Now is the right time to open the business to global capital to fuel future growth ambitions and address India’s significant energy deficit. This offer will help us bridge that deficit while allowing international investors access to India's growth story.”