Reliance Infratel scraps Rs 6,000 cr IPO

Press Trust Of India / New Delhi August 15, 2008, 14:44 IST
The stock market woes for India's second richest person Anil Ambani, it seems, are unending with Reliance Infratel scrapping its estimated Rs 6,000-crore IPO plans for now - amid huge secondary market loss for the group companies.

Reliance Infratel, the tower business arm of the group's telecom entity Reliance Communications, has allowed the regulatory approval to lapse without coming out with an IPO and is unlikely to revive the process soon.

A company spokesperson did not take queries on lapse of the approval period and on whether the company was looking to revive the process by filing a fresh draft IPO prospectus with market regulator SEBI.

On the secondary market, Reliance Infrastructure, formerly Reliance Energy, has logged the biggest loss among the top 30 blue-chip companies in the country in the seven- month downslide at the bourses and the group as whole has lost market value worth over Rs 2,00,000 crore in the same period.

The public offer, which was planned, had got a regulatory go-ahead with SEBI's issuance of observations on the draft red herring prospectus (DRHP) on May 12. As per the norms, it was required to close the IPO within 90 days of issuance of SEBI's observation - the period that ended on August 11.

The group had announced the IPO for telecom tower firm Reliance Infratel, which was estimated to raise close to Rs 6,000 crore in February after a stupendous response to Reliance Power initial offer, which raised over Rs 10,000 crore and was the the group's first ever public issue.

The record response notwithstanding, Reliance Power met with a dismal response at the time of its listing, which happened days within the Reliance Infratel IPO being announced.