Our Bureau

New Delhi, Sept. 15

The Power Ministry is in the process of seeking Cabinet approval afresh for the initial public offer of Power Finance Corporation (PFC), the Power Secretary, Mr R.V. Shahi, said on Friday.

"We will go to the Cabinet soon with a proposal for PFC that will have only the IPO," he told reporters on the sidelines of a conference here.

The new proposal would be for issue of 10 per cent fresh equity by the State-run company, he said, but did not give any timeframe for approaching the Cabinet.

The fresh approval was necessitated as the earlier Cabinet nod was for 10 per cent additional equity through the public offer along with sale of five per cent Government equity. But with the Centre deciding to put on hold all disinvestment cases due to opposition from the supporting Left parties and the DMK, the company could not proceed further with the process.

The Ministry would now have to draft a new Cabinet note for the proposed IPO to enable PFC raise its equity base by 10 per cent, which amounts to 10.30 crore shares.

The company then would file the red herring prospectus with market regulator, Securities and Exchange Board of India.

(This article was published in the Business Line print edition dated September 16, 2006)
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