LIC Likely To File Draft IPO Prospectus In Dec; Anchor Investor Talks To Begin Next Week: Report
The issue size is likely to have a median size ranging between Rs70,000 cr to Rs100,000cr.
Bankers will begin contacting the potential anchor investors in the initial public offering (IPO) of Life Insurance Corp. of India (LIC) next week, as they want to make sure that there is enough demand for the most talked-about share sale, which might also be the nation's biggest IPO.
A list including the details of 100 global investors has been sent to the 10 banks working on the deal and the institutions will speak to different sets of investors, according to the people familiar with the development, as per the Bloomberg report.
The report also said, banks are likely to file the draft IPO prospectus with the SEBI by the first week of December, once the embedded value of the insurance corporation is finalised.
The government owns 100 percent of the insurance company at the moment, but it is considering offloading a 5-10 percent stake. The issue size is likely to have a median size ranging between Rs70,000 cr to Rs100,000cr. However, the valuation of the firm is yet to be decided, and the government is still to announce whether the IPO will happen in one tranche or two tranches.
A 10% reservation is secured for policyholders who wish to subscribe to the shares. Employees and officers of the insurance provider may also get ESOPs.
LIC has a headcount of 2.92 lakh employees and 22.70 lakh agents. These figures are big enough to have a substantial impact on the demand for the LIC IPO.
Cyril Amarchand Mangaldas will act as the legal advisor and KFIN Technologies as the registrars to the IPO. In addition, the government has selected ten investment banks, including Kotak Mahindra Bank Ltd., Goldman Sachs Group Inc., JPMorgan Chase & Co. and ICICI Securities Ltd., to arrange the sale.