Power Finance Corporation Limited FPO Opens

Power Finance Corporation Limited FPO Opens

Price Band fixed between ` 193 and ` 203 per Equity Share

Discount of 5% to the Issue Price to be offered to Retail Bidders and Eligible Employees

Chandigarh, Sanjay Pahwa:

Power Finance Corporation Limited (the “Company” or “Power Finance”), a Navratna financial institution focused on the power sector, is proposing a further public issue of 229,553,340 Equity Shares of face value of Rs 10 each for cash at a price per Equity Share (including “share premium”) to be decided through the Book Building Process ("the Issue"). The Issue comprises a fresh issue of 172,165,005 Equity Shares by the Company (the “Fresh Issue”) and an Offer for Sale of 57,388,335 equity shares by the President of India, acting through the Ministry of Power, Government of India (the “Selling Shareholder”). The Issue comprises a net issue to the public of 229,277,876 Equity Shares (the “Net Issue”) and a reservation of 275,464 Equity Shares for subscription by eligible employees (the “Employee Reservation Portion”). The Issue would constitute 17.39% of the post Issue paid-up equity capital of the Company and the Net Issue would constitute 17.37% of the post Issue paid-up equity capital of the Company.

The Price Band has been fixed between ` 193 and ` 203 per Equity Share. A discount of 5% to the Issue Price determined pursuant to completion of the Book Building Process has been offered to Eligible Employees (the “Employee Discount”) and to Retail Bidders (the “Retail Discount”). The minimum Bid Lot will be 28 Equity Shares and in multiples of 28 Equity Shares thereafter. The Issue closes on Friday, May 13, 2011. Discount is not offered on application, but on Allotment. The excess amount paid on application will be refunded to such Bidders or will be unblocked from their ASBA Accounts as the case may be, after Allotment.

Up to 50% of the Net Issue will be allocated on a proportionate basis to QIBs (the “QIB Portion”). Further, 5% of the QIB Portion shall be available for allocation on a proportionate basis to Mutual Funds only. The remainder of the QIB Portion shall be available for allocation on proportionate basis to QIBs including Mutual Fund, subject to valid bids being received from them at or above the Issue Price. In addition, not less than 15% of the Net Issue will be available for allocation on a proportionate basis to Non-Institutional Bidders and not less than 35% of the Net Issue will be available for allocation on a proportionate basis to Retail Bidders, subject to valid Bids being received at or above the Issue Price. Any Bidder may participate in this Issue through the ASBA process by providing the details of the ASBA Accounts in which the corresponding Bid Amounts will be blocked by the SCSBs.

The Equity Shares being offered as a part of the Fresh Issue through the Red Herring Prospectus are proposed to be listed on the National Stock Exchange of India Limited and the Bombay Stock Exchange Limited.

The Book Running Lead Managers (“BRLMs”) to the Issue are DSP Merrill Lynch Limited, Goldman Sachs (India) Securities Private Limited, ICICI Securities Limited and JM Financial Consultants Private Limited.

It is to be distinctly understood that the permission given by the Stock Exchanges should not in any way be deemed or construed that the offer document has been cleared or approved by the Stock Exchanges nor does it certify the correctness or completeness of any of the contents of the offer document. The investors are advised to refer to the Red Herring Prospectus for the full text of ‘Disclaimer Clause of Stock Exchanges.