Insurance behemoth Life Insurance Corporation of India (LIC) on Tuesday announced that it has raised Rs 5,627 crore from anchor investors ahead of its Rs 21,000 crore initial public offering(IPO), which is also the country’s largest public offer so far.
The company issued 59.29 milllion equity shares to 123 anchor investors at the upper price band of the offer of Rs 949 per share. Government of Singapore, BNP Paribas LLC, and Societe Generale were among the top foreign investors who participated in the anchor book. Overall, foreign funds invested a little above Rs 1,600 crore in the anchor book. However, more than 71% of the total anchor book was subscribed by 15 domestic mutual funds, through 99 schemes, the document showed. SBI Hybrid Fund bid for the highest number of shares or 9.2% of the total anchor book.
According to media reports, the public offer of the insurer saw bids from anchor investors to the tune of Rs 7,000 crore against the anchor book size of Rs 5,627 crore.
The government will offload 22,13,74,920 shares or a 3.5% stake in LIC at a price band of Rs 902-949 per share, aiming to raise up to Rs 21,000 crore from the share sale. The issue will open for subscription for retail and other investors on May 4 and will close on May 9. Post which, the company will get listed on the exchanges on May 17. Of the total 221.3 million shares on the offer, 50% of the shares are reserved for qualified institutional buyers (QIBs), 35% for retail investors, and 15% for non-Institutional investors. Additionally, in the offer, LIC policyholders will get a discount of Rs 60 per equity share, while retail investors and employees will get a discount of Rs 45 each.
Despite the trimming of issue size from nearly Rs 60,000 crore earlier to Rs 21,000 crore currently, the insurer’s IPO will still be the country’s largest public offering so far, followed by Paytm (One97 Communications) — Rs 18,300 crore, and Coal India (Rs 15,199 crore). On successful listing, the company will be valued at Rs 6 lakh crore.
So far this year, only seven companies have raised Rs 12,119 crore — including companies like Adani Wilmar and Ruchi Soya Industries.