Cairn plays it safe, prices IPO at Rs 160
Cairn India today settled on a price of Rs 160 for its initial public offering of 328.8 million shares. This was at the lower end of the price band of Rs 160-190 at which it had offered the shares. The company has raised Rs 5260 crore through the IPO that closed yesterday.
This also means that the company may have to revise the price of the shares it had sold in private placements to Malaysian state owned oil company Petronas and others before the public float.
It had sold 209.67 million shares to Petronas, Videocon and Blackrock-Merrill Lynch, at Rs 176.48 per share at a 10 per cent premium at the bottom of the band. It had raised Rs 3700 crore through the pre-IPO placement.
At the time of its pre-IPO placement, Cairn had said in a statement that if the shares to the public are issued at a price less than that of the pre-placement, it will revise the price. At an issue price of Rs 160, Cairn India may have to refund at least Rs 335.47 crore to its private investors.
International Finance Corporation, the private investment arm of the World Bank, had also announced that it will invest up to $45 million in the company. Cairn Energy PLC, the UK based parent company has diluted 30.5 per cent of its holdings in Cairn India through the IPO.
Cairn India has known assets of 754 million barrels oil equivalent (MMBOE) in Rajasthan of which it owns 472 MMBOE. It also estimates that there are additional reserves of 414 MMBOE in Rajasthan fields. It also estimates that there are estimated reserves of 157 MMBOE in fields outside Rajasthan much of which is in deepwater block K6-dwn-982.
Cairn owns 13 exploration blocks in the country of which two - Ravva off shore on the east coast and Cambay Basin on the Gujarat coast. The Rajasthan blocks where oil was discovered by the company are expected to begin production by 2009.
Cairn India will own 10 of the 13 assets of the parent company and the three blocks on the Himalayan fold will be jointly owned by the two companies.
Once the Rajasthan blocks begin production, the company would be producing 150,000 barrels per day, which would be around 20 per cent of the country's domestic production. Cairn is also investing $90 million in the Ravva off shore to maintain production levels at 50,000 barrels per day.
This also means that the company may have to revise the price of the shares it had sold in private placements to Malaysian state owned oil company Petronas and others before the public float.
It had sold 209.67 million shares to Petronas, Videocon and Blackrock-Merrill Lynch, at Rs 176.48 per share at a 10 per cent premium at the bottom of the band. It had raised Rs 3700 crore through the pre-IPO placement.
At the time of its pre-IPO placement, Cairn had said in a statement that if the shares to the public are issued at a price less than that of the pre-placement, it will revise the price. At an issue price of Rs 160, Cairn India may have to refund at least Rs 335.47 crore to its private investors.
International Finance Corporation, the private investment arm of the World Bank, had also announced that it will invest up to $45 million in the company. Cairn Energy PLC, the UK based parent company has diluted 30.5 per cent of its holdings in Cairn India through the IPO.
Cairn India has known assets of 754 million barrels oil equivalent (MMBOE) in Rajasthan of which it owns 472 MMBOE. It also estimates that there are additional reserves of 414 MMBOE in Rajasthan fields. It also estimates that there are estimated reserves of 157 MMBOE in fields outside Rajasthan much of which is in deepwater block K6-dwn-982.
Cairn owns 13 exploration blocks in the country of which two - Ravva off shore on the east coast and Cambay Basin on the Gujarat coast. The Rajasthan blocks where oil was discovered by the company are expected to begin production by 2009.
Cairn India will own 10 of the 13 assets of the parent company and the three blocks on the Himalayan fold will be jointly owned by the two companies.
Once the Rajasthan blocks begin production, the company would be producing 150,000 barrels per day, which would be around 20 per cent of the country's domestic production. Cairn is also investing $90 million in the Ravva off shore to maintain production levels at 50,000 barrels per day.
posted by SY at 12:55 AM
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