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Essar Energy Cuts U.K. IPO Price to 420 Pence a Share, Below Initial Range

Essar Energy Ltd., a unit of India’s Essar Group, reduced the price of its initial public offering, according to terms of the sale obtained by Bloomberg News.

The shares are now being offered at 420 pence apiece, from the previously announced range of 450 pence to 550 pence each, according to the terms. Essar is now seeking to raise $2.2 billion from the offering and the book will close later today, the terms show. JPMorgan Cazenove and Deutsche Bank AG are joint bookrunners for the sale.

Manish Kedia, Mumbai-based spokesman for Essar Energy, declined to comment.

European companies are attempting the biggest initial public offerings in three years just as sovereign-debt downgrades rattle markets the most since the collapse of Lehman Brothers Holdings Inc. While Madrid-based flight-reservations provider Amadeus IT Holding SA and Poland’s PZU SA priced IPOs worth $4.5 billion this week, companies from UralChem Holding Plc to Grupo T-Solar Global SA and OAO Kuzbass Fuel Co. postponed or reduced their offerings.

UralChem, Russia’s second-largest maker of nitrogen-based fertilizer, postponed its $642 million London IPO, saying it “cannot be priced at a level which reflects a fair value of the company” due to “current market conditions,” the Moscow-based company said yesterday.

The VStoxx Index, a gauge of options to protect against losses on the benchmark Euro Stoxx 50 Index, rose as much as 40 percent in the two days ended April 28, the most since October 2008, a month after New York-based Lehman failed in the largest ever bankruptcy.

To contact the reporter on this story: Adam Haigh at Zijing Wu in London at

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