Wipro set to sponsor $1 billion American depositary shares

Wipro Technologies, the third-largest information technology (IT) company, is said to be planning its first sponsored American depositary shares (ADS) issue worth $ 1 billion, according to media reports on Thursday.

The move will increase the New York-listed firm’s float in the US from the current 1.5%. Wipro had launched its primary ADR issue in 2000.

Wipro officials did not comment.

“I will not be able to say anything. We are in the silent period,” said Girish Paranjpe, joint chief executive officer.

Wipro’s bigger rival and Nasdaq-listed Infosys Technologies has to date approached investors in the secondary market in the US thrice — in 2003, 2004 and 2006.

Sponsored ADS issues involve sale of local equity by shareholders in the US market with the co-operation of the company.

This exercise is sponsored by the company but all costs of the issue are borne by shareholders.

Analysts said a decision by Wipro could be driven by the Securities and Exchange Board of India’s proposal to make 25% public holding mandatory.  

Promoter Azim Premji currently holds 79% stake in Wipro.