Nandi Economic Corridor Enterprise, executor of the controversial Bangalore-Mysore expressway, plans to raise about $450 million through an initial public offer (IPO), The Economic Times reported quoted an unnamed person familiar with the development.

The report quoted the person as saying that the board of directors will finalize the amount of stake to be sold to public and that the mandate to arrange for the share sale is likely to be given during the first quarter of 2011 for which Enam Securities and SBI Capital Markets are bidding.

The proceeds of the public issue, which will value the company at more than $1.5 billion, will be used to part-finance the construction of a 99-kilometer expressway between Bangalore and Mysore, three township projects and a 400 MW power project, the report said.

Nandi Economic Corridor Enterprise plans to sell land in plots instead of developing the whole parcel of land and thus expects to generate huge profits through this process, the report said.

Airro Holding V Mauritius, a fund owned by JPMorgan had bought an 8 percent stake in the project for about $110 million, valuing the company at about $1.5 billion.

B N Kalyani, chairman of the $2.4-billion Kalyani Group and Ashok Kheny hold a 77 percent stake in the company founded mainly by BF Utilities. While Anil Ambani holds a 15 percent stake, Indus Fund and New India Insurance hold 6 percent and 2 percent respectively.

The Bangalore-Mysore infrastructure corridor or the expressway involves construction of 7,000 acres in the first phase.

The project consists of four components — a 9.1-kilometer stretch connecting Bangalore to the peripheral road, a 41-kilometer peripheral road connecting Bangalore and Hosur (in Tamil Nadu), Tumkur road, a 111-kilometer expressway between Bangaluru and Mysore and a 3-kilometer elevated road near Bangalore.

About 55 kilometer of peripheral road is complete and about 8.5 kilometer of the link road has been completed. About 5 kilometer of expressway has been built that is expected to cut travel time between Bangalore and Mysore by half.