Follow on Public Offer of Rural Electrification Corporation Limited

The Cabinet Committee on Economic Affairs today approved a proposal of Follow-on Public Offer (FPO) of Rural Electrification Corporation Limited (REC) of 17,17,32,000 Equity shares (Seventeen crore Seventeen lakh Thirty Two thousand) of Rs.10 each constituting 20% of existing paid-up capital which comprises fresh issue of 12,87,99,000 (Twelve crore Eighty Seven lakh Ninety Nine thousand) Equity Shares (15% of existing paid-up capital) and Offer for Sale (Disinvestment) of 4,29,33,000 (Four crore Twenty Nine lakh Thirty Three thousand) Equity Shares (5% of existing paid-up capital) by the Selling Shareholder i.e. the President of India.

Additional resources generated through the issue of an FPO will be utilized by REC in its investment programmes. Part of the shares will be issued for employees.

Background:

The Rural Electrification Corporation Limited (REC) incorporated in July 1969 under the Companies Act, 1956 as a Development Financial Institution is dedicated to the growth of the power sector in general and rural electrification in particular. REC has been financing power projects in generation, transmission and distribution. During the Xth Five Yean Plan, REC made a disbursement of Rs.42248.34 crore. REC’s cumulative disbursements to various types of power projects till 31.03.2009 were Rs.92400.65 crore.

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AKT/SH/VK