The largest of them was an offering by GMR Infrastructure which, thanks to the solid demand, was increased to $1 billion from $750 million. However, the company had to make a trade-off in terms of price. According to a source, the final price was set at the bottom of the Rs240 to Rs290 range, for a 6.9% discount to the latest close.
ôIt could have gotten a tighter price at the base size, but the company was more concerned about raising as much money as possible, than getting the best price,ö one sources notes. Citi, JM Financial Consultants, JPMorgan, Kotak Mahindra, Lehman Brothers and UBS were the joint bookrunners.
United Breweries, which controls about half of IndiaÆs beer and spirits markets and operates two airlines, was able to price its QIP at the top, however, after its $151.8 million offering was about three times covered. Alongside the QIP, which went to more than 20 individual accounts, the company also raised $180 million from the sale of warrants to its promoters. The exercise price on the warrants is equal to the QIP price which was fixed at Rs1,110 after being offered in a range between Rs1,060 and Rs1,110.
The final price represented a discount of 3.9% to the latest close. CLSA was the sole bookrunner.
The third company in the market was power producer CESC, which raised $150 million with the help of Citi, CLSA and Kotak Mahindra. The company fixed the price at Rs618, which was near the top of the Rs595 to Rs620 range and represented a tight 2.1% discount to the most recent close. According to sources, the deal was close to two times covered and was allocated to more than 20 individual accounts.
CESC will use part of the money to finance the 600 megawatt power plant that makes up the first phase of its 1,600-1,900MW Haldia project. The company is currently conducting a pre-feasibility study for the second phase, which will comprise a coal-fired generator with a capacity of 1,000-1,300MW, and has initiated the land acquisition process with the state government. The rest of the proceeds will be used to strengthen its distribution and transmission network and for general corporate purposes.
All three deals were launched at a fixed dollar amount, with the number of shares to be issued varying depending on the final price. They were also sold on a non-marketed basis over an approximate 24-hour period.
GMR said it would use the money it raised for capital expenditure, but didnÆt specify any particular projects. The company is involved in the operation of power plants, toll roads and airports. It has also started to pursue a number of infrastructure projects outside of India and in July it was part of a consortium that won the bid to expand and operate the Sabiha Gokcen International Airport in Istanbul, Turkey. GMR has a 40% stake in the consortium.
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