NEW DELHI, Sept 29: India’s Reliance Power Ltd is planning an initial public offering to raise as much as $3.5 billion, which would be the country’s biggest ever IPO, reports said on Saturday.

The initial public offering (IPO) would be to raise money to develop mega power projects, India’s Mint business paper and The Economic Times said.

Reliance Power, a unit of the Bombay Stock Exchange-listed Reliance Energy Ltd, was expected to file the prospectus with market authorities next week, Mint reported, quoting two people close to the plan.

Reliance Energy, led by billionaire businessman Anil Ambani, declined to comment on what the company called “market speculation,” the newspapers said.

Reliance Power, part of the Reliance-Anil Dhirubhai Ambani Group or R-ADAG, has been valued at around $11 billion.

Reliance Power aims to sell shares equivalent to a 15-30 per cent stake in the company, the reports said.

The share sale is part of a plan to restructure Reliance Energy into three distinct businesses in power, real estate and infrastructure, Mint quoted an unnamed R-ADAG official as saying.

Each of these businesses could be listed at a later date, the executive said.

Reliance Power won rights to develop a 4,000MW mega power project at Sasan in the central state of Madhya Pradesh in June. Its parent, Reliance Energy is building a 1,200MW power plant at Rosa in northern Uttar Pradesh state.

A sector expert said the possible share sale and restructuring could make it easier to raise finances for the mega power projects.

“It looks like they are putting their generation projects into one company, which would make it easier for them to raise money for these capital-intensive projects,” said Arvind Mahajan, a senior official of consulting firm KPMG International.Reports of the IPO drove Reliance Energy Ltd shares up 7.9 per cent to 1,205.50 rupees ($30.33) on Friday. —AFP