The Department of Investment and Public Asset Management (DIPAM) Secretary announced today that the government’s Offer for Sale (OFS) in General Insurance Corporation of India (GIC) will open tomorrow for non-retail investors. Retail investors and employees of GIC will have the opportunity to bid on Thursday. The government plans to divest 3.39% of its equity in GIC, with an additional 3.39% available as a green shoe option.
According to a CNBC-TV18 report citing sources, the OFS will include 5.95 crore shares, with an additional 5.95 crore shares available through the green shoe option. The floor price has been set at Rs 395 per share, which represents a 6% discount to the current market price (CMP). The total size of the OFS, including the green shoe option, is expected to be around Rs 4,701 crore.
As per the latest shareholding pattern available on the exchanges, the Government of India (Promoter) holds a 85.7% stake in the company. As per the Minimum Public Shareholding norms, a promoter cannot hold more than 75% stake in a company. GIC RE’s promoter has however never offloaded any stake in the company ever since it listed in October 2017. The OFS is largely to bring down the promoter holding as per the MPS norms prescribed by the regulators.
