State-run Coal India’s wholly owned subsidiary Central Mine Planning and Design Institute, which has filed the Red Herring Prospectus (RHP) with capital market regulator SEBI for its proposed initial public offering (IPO), is planning to open the IPO for subscription on March 20.
The public issue, entirely an offer-for-sale (OFS) of 10.71 crore shares by Coal India with no fresh issue component, is set to close on March 24.
In a stock exchange filing on Friday, Coal India said the RHP filing pertains to the proposed IPO of CMPDIL comprising an OFS of up to 10.71 crore equity shares by Coal India, which remains subject to receipt of applicable approvals, market conditions, and other relevant considerations.
Notably, CMPDIL had filed a draft papers with SEBI in May last year for its proposed initial public offering. Currently, Coal India has eight subsidiaries, and CMPDIL is the only non-coal-producing subsidiary.
CMPDIL was set up for preparing perspective plans, rendering consultancy services and undertaking exploration and drilling work to establish coal reserves in the country and collect detailed data for the preparation of projects for actual mining.
“The Promoter Selling Shareholder will be entitled to the entire proceeds of the Offer after deducting its portion of the offer expenses and relevant taxes thereon. Our company will not receive any proceeds from the Offer,” Central Mine Planning and Design Institute said in its Red Herring Prospectus (RHP).
The company said the object of the public offer are to achieve the benefits of listing the equity shares on the stock exchanges; and carry out the offer for sale of up to 10.71 crore shares of face value of ₹2 each by the promoter selling shareholder.
“50 per cent of the equity shares allotted to anchor investors under the Anchor Investor Portion shall be locked-in for a period 90 days from the date of allotment and the remaining 50 per cent shall be locked-in for a period of 30 days from the date of allotment,” according to RHP. Bidding for anchor investors will take place on March 18.
CMPDIL is now very crucial for the country’s energy security as CIL has been looking to acquire lithium blocks in Australia and Argentina, among other countries.
IDBI Capital Markets and Securities and SBI Capital Markets are the book-running lead managers for the public issue.
Bharat Coking Coal (BCCL), another subsidiary of Coal India, came out with its 1,071-crore IPO in January this year.
On Friday, Coal India scrip ended the day at ₹466.80 apiece on BSE, down 0.71 per cent from the previous close.