Mahanagar Gas IPO to hit Dalal Street on Tuesday

Mahanagar Gas Ltd (MGL), India's second biggest CNG retailer, will hit the capital markets on Tuesday to raise around Rs 1,040 crore through an initial public offer.

The company, promoted by state-run GAIL and British Gas Asia Pacific Holdings Pte Ltd, is making an offer for sale of up to 24,694,500 equity shares of Rs 10 each.

British Gas and GAIL will sell up to 12,347,250 equity shares each in the IPO.

The gas distributor firm has fixed the price band of Rs 380-421 for its initial public offer.

The initial share-sale programme will open tomorrow and close on June 23. At the upper end of the price-band, the firm will garner Rs 1,039.64 crore.

The money raised through the IPO would accrue to the promoters who are selling their stake.

The IPO is being managed by Kotak Mahindra Capital Company Ltd and Citigroup Global Markets India Pvt Ltd.

MGL, a major distributor of compressed natural gas (CNG) and piped natural gas (PNG) in Mumbai and adjoining areas, receives gas at its stations located at Wadala, Mahape, Ambernath and Taloja through pipelines owned by GAIL.

"... objects of the offer are to achieve the benefits of listing the equity shares on the stock exchanges and to carry out the offer for sale...listing of the equity shares will enhance our brand name and provide liquidity to the existing shareholders," the firm said in the IPO papers.