Power Finance Corp may launch FPO in April-May

 State-run Power Finance (PFC) may come out with a 20% follow-on public offer in April-May next year if the department of disinvestment clears a proposal floated by the power ministry. The power ministry has proposed disinvestment of 5% of the Centre's stake in the public sector finance institution, as well as the issue of 15% fresh equity, through the FPO route. "The power ministry has sent a proposal for a 15% fresh equity and 5% disinvestment of government stake in PFC," department of disinvestment secretary Sumit Bose told reporters here. "The company needs funds, that's why they have asked for a bigger share of fresh equity," Mr Bose said. PFC, which is engaged in funding power generation, transmission and distribution projects across the country, plans to use the funds mopped up from the FPO to finance both existing loans, as well as future lending activities. The follow-on public offer is likely to be launched in April-May next year, according to sources. At present, the government of India holds 89.78% stake in the firm. The government, which hopes to raise . 40,000 crore through its disinvestment programme this fiscal, has already mopped up close to . 20,000 crore through the sale of stakes in PSUs Satluj Jal Vidyut Nigam, Engineers India, Coal India and PowerGrid Corporation.