UCO Bank to raise Rs 900-950 cr from FPO

UCO Bank is planning to raise Rs 900-950 crore from follow-on-public (FPO) offer subsequent to a strong rally in the stock market. UCO bank authorities had estimated premium for the issue from Rs 50 to over Rs 60 a share, with upturn in the market.

By means of 13.5 crore shares of Rs 10 each, the bank would arrange to hit the market. Moreover, the issue would reduce the government shareholding from existing 63.5 per cent, to around 51 per cent.

As per the current market conditions, getting a premium of Rs 60 will not be a problem. A premium of around Rs 50 a share was expected previously, UCO Bank chairman and managing director S K Goel said.

He said that the final pricing would be made later after consulting the merchant bankers. The issue has been probable to hit the capital market in January, according to the sources. The bank may use the book-building method for the FPO rather than fixed pricing method. Meanwhile, the bank is expecting better valuation with entrance into insurance business, which is likely to be in place shortly.