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NMDC offers 5% discount for retail investors

business Updated: Mar 04, 2010 21:59 IST
HT Correspondent

The country’s largest iron ore producer and Navaratna public sector undertaking National Mineral Development Corporation (NMDC) Ltd on Thursday announced its follow-on public offer (FPO) of over 33-crore equity shares. The company also announced an upfront discount of 5 per cent on the offer price in order to stimulate greater retail participation.

While NMDC said it would determine the offer price through the book-building process, it is likely to raise over Rs 14,400 crore at the prevailing market rate of Rs 435 per share.

“A discount of 5 per cent on the determined offer price would be given to retail investors and eligible employees of the company,” said Rana Som, the company’s chairman and managing director.

The FPO will be open for three days from March 10 and will divest 8.38 per cent of the government’s stake in the company. It had previously divested 1.62 per cent through its initial public offer, thus offloading a total 10 per cent stake.

NMDC expects to increase its iron ore production to 50 million tonnes by 2014-15 from the present 30 million tonnes and acquire four new mines. “We are looking at acquiring mines abroad for coal, rock phosphate and potash,” said Som.

The company is planning to expand to fertiliser, minerals and has invested in development of renewable energy resources.