LIC IPO: Over 25 anchor investors expressed interest in issue offer, says official; anchor book to open on 2 May

More than 25 anchor investors both domestic and foreign have expressed interest in the proposed maiden public offering by state-owned Life Insurance Corporation of India (LICI), a PTI report said on Friday quoting an official.

To raise Rs 21,000 crore from the market next month, the government plans to dilute 3.5 per cent of its stake in LIC. The government had invested Rs 5 crore as seed capital when LIC was formed in 1956.

An official of one of the lead managers said 50 per cent of the offer is reserved for QIPs, including anchor investors. He said 35 per cent is being reserved for retail investors, 15 per cent for high networth individuals and ten per cent for policy holders.

He said that the anchor book would be opened on May 2.

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An anchor investor receives 30 per cent of the QIP portion, he said.

LIC Managing Director Siddhartha Mohanty told PTI that even after the IPO, the government's sovereign cover will remain under Section 37 of the LIC Act.

LIC's government shareholding will not drop below 51 per cent, he said.

To a query, he said "the government did not go for additional issue of shares by LIC but instead opted for dilution as the corporation is cash rich with healthy solvency".

Mohanty said the Centre, in the last two years, had not taken dividend and ploughed back Rs 5,600 crore to the life insurer.

Post IPO, LIC will be run by a professional board with nine independent directors who have been already inducted. Mohanty said the post of chairman will be in place till 2024, and then replaced by MD and CEO.

With the largest market leadership in the life insurance market in India, it has Rs 40 lakh crore as assets under management (AUM) and reserves of Rs 30 lakh crore.