Ruias-led Essar Group is set to launch the largest public offer by an Indian entity with plans to raise up to $3 billion through sale of shares of its energy venture and a listing on London Stock Exchange.

The group, led by brothers Shashi and Ravi Ruia, is looking to sell 20-25 per cent shares of its energy (oil and power) business, to raise $2.5-3 billion (about Rs. 14,000 crore) to part finance its estimated Rs. 40,000-crore investment plans in the next 3-4 years.

Initial public offer

The proposed initial public offer could give Essar's energy business a valuation of about $12 billion (nearly Rs. 56,000 crore), sources close to the development said.

When contacted, an Essar Group spokesperson said, “Essar group is always looking at a range of different funding options but has not yet made any specific decision with regard to further financing.”

Funds have already been tied up for raising the power generation capacity from 1,200 MW to 6,000 MW.

In the second phase, the capacity is sought to be raised to 11,000 MW at an investment of about $4.5 billion.

Likewise, the group is already working on expanding its refining capacity from 10.5 million tonnes to 18 million tonnes and funds to the tune of $1.6 billion have been tied up.

In the next phase, the capacity is sought to be expanded to 34 million tonnes, a development that would require an additional about $4 billion (about Rs. 17,000 crore).