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Govt seeks bids for legal adviser, book running lead managers for LIC IPO
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SME Times News Bureau | 15 Jul, 2021
The Centre has invited bids for book running lead managers (BRLM), legal
adviser, and registrar and share transfer agent (RTA) for the mega
initial public offering (IPO) of LIC.
The Department of Investment and Public Asset Management (DIPAM) has also invited bids for an advertising agency.
The
bid submission for BRLMs and RTA starts on July 15 and ends on August
5. On the other hand, the bid submission for legal adviser and
advertising agency starts on July 15, but ends on August 6.
The
development comes after the Cabinet Committee of Economic Affairs (CCEA)
earlier this month gave its in-principle approval to the IPO.
A
top official source told IANS that said that the CCEA, in its meeting on
July 7, approved the reworked plan for the IPO finalised by the DIPAM,
clearing the several impediments for the country's largest IPO.
"We
have also fixed the way for the offer and how investors should be roped
in to the insurer. With this, the road has been cleared for the IPO
that in any case we were planning for FY22," the official said.
The
highly-placed source further told IANS that now the alternative
mechanism (AM) or the Group of Ministers would sit to decide on the
timing and quantum of shares to be offered. The appointment of managers
for the issue will also follow.
Post the Union Budget FY22, the government has taken several legislative and executive steps to pave way for the mega IPO.
As
per the amendments proposed under the Finance Bill 2021, the authorised
share capital of LIC shall be Rs 25,000 crore, divided into 2,500 crore
shares of Rs 10 each.
Capital market regulator SEBI has also eased the minimum public offer norms in a bid to pave the way for the LIC IPO.
In
February, the board of the Securities and Exchange Board of India
(SEBI) has decided recommend changes in regulations, and for issuers
with post issue market capital exceeding Rs 1 lakh crore, the
requirement of minimum public offering (MPO) will be reduced from 10 per
cent of post issue market capital to Rs 10,000 crore along with 5 per
cent of the incremental amount beyond Rs 1 lakh crore.
The government expects to bring the IPO around Diwali this year.
According to Chief Economic Adviser (CEA) K.V. Subramanian, the LIC IPO may fetch the government around Rs 1 lakh crore.
The
tender documents published by DIPAM on Thursday said that the listing
of shares of the LIC on stock exchanges would entail part-sale of
government's stake in LIC and to raise fresh equity share capital for
LIC, through a prospectus based IPO in the domestic market as per SEBI
Rules and Regulations.
The Life Insurance Corporation of India, a
statutory Corporation constituted under the LIC Act 1956, is a leading
life insurer of India wholly owned by the government. It has three
branches outside India - in the UK, Fiji and Mauritius, a wholly-owned
subsidiary in Singapore and Joint Ventures in Bahrain, Kenya, Sri Lanka,
Nepal, Saudi Arabia, and Bangladesh. Its subsidiaries in India include
LIC Pension Fund Ltd, and LIC Cards Services Ltd.
Its associates include the IDBI Bank Ltd, the LIC Mutual Fund and the LIC Housing Finance Ltd.
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