Tue, Jul 8 01:05 AM
UTI Asset Management Company has deferred its proposed initial public offering (IPO). Uncertain marketing conditions have forced the country's oldest mutual fund to postpone its public offer, nearly three months after it received Securities Exchange Board of India (SEBI) approval in April.
The company will now be required to file a fresh prospectus with Sebi to float the IPO. "Once the IPO gets deferred, fresh prospectus needs to be filed with Sebi for approval and it will take at least six months for the IPO to hit the market," said a senior official from a leading investment bank. The company planned to mobilise close to Rs 2,000 crore through the public offer, the first by an Indian mutual fund.
The IPO would also have offered an exit route to the four public sector sponsors of the company-State Bank of India, Life Insurance Corporation, Punjab National Bank and Bank of Baroda. Current norms require companies to float a public offer within three months from the date of receiving Sebi approval and UTI AMC would have had to float its IPO before July 22.
In the recent past, IPO's have experienced low subscription levels. Archidply and Niraj Cements received subscription levels of 1.04 and 1.07 per cent, respectively.
