Coal India to decide on anchor investors soon

The country's largest coal producer Coal India is likely to decide in 2-3 days on roping in anchor investors for its upcoming mega initial public offer, Coal Minister Sriprakash Jaiswal said here on Friday.

The coal major would become the first PSU to rope in anchor investors if it decides in favour of the proposal.

Anchor investors are those investors who buy shares of the company before the launch of the public issue.

The concept of anchor investors was approved by Sebi last year.

Anchor investors, who cannot be a promoter of the issuer company, can be allocated as much as 30 per cent of the portion reserved for qualified institutional buyers.

Also, such investors must bid for at least    10 crore (   100 million) worth shares.

The PSU has already filed the draft papers for its IPO, billed to be India's biggest issue, through which the government expects to raise up to    15,000 crore (   150 billion).

As per the Draft Red Herring Prospectus filed with Sebi by the company, it has offered 631,636,440 equity shares with a face value of    10 each.

The mega issue of CIL would hit the market on October 18 and closes on October 21.

Sources say the government is looking to raise between    12,000 crore (   120 billion) and    15,000 crore (   150 billion) from selling its 10 per cent of the stake in the firm through the public issue.

Currently, government owns 100 per cent stake in the company.

With the help of its huge workforce, Coal India produced 4,301.5 million tonnes of coal in the last fiscal, when the total output of the country was at 532 million tonnes.