Discount IPO for PhosAgro
RUSSIAN fertiliser producer PhosAgro has priced its joint London and Moscow share sale at a deep discount, as it looks to raise up to $500m (£312m).
The phosphate fertiliser firm has set a price range of $13 to $16.50 per global depository receipt (GDR), valuing the company at as much as $6.1bn.
The listing price is about 30 per cent below the top-end valuation given by analysts of up to $9bn, indicating the lengths firms are prepared to go to for a successful float.
At least seven Russian companies have pulled floats, with investors especially reluctant to buy existing shares sold by wealthy businessmen, rather than new shares to fund the company’s long-term growth.
Politician Andrei Guryev, the majority owner of the company, is selling down a 10 to 15 per cent stake in the sale.
Sources close to the deal said investors had responded warmly to the initial public offering (IPO) at the pre-marketing stage.
Sibur, a Russian chemicals firm, has also emerged as a likely cornerstone investor, adding to the likely success of the float. The firm, which is Russia’s largest petrochemical producer, is said to be considering a $100m purchase.
PhosAgro will be hoping to capitalise on the success of Global Ports, the Russian container terminal operator that last week defied difficult European markets and a poor track record for Russian floats to get its $534m listing away.
MEET THE ADVISERS: CITIGROUP
STEVE KALE
CITIGROUP
STEVE KALE is on the team from Citigroup acting as joint global coordinator and bookrunner on PhosAgro’s initial public offering (IPO).
As director in the European equity capital markets team, he is responsible for Russia and has more than 20 years of investment banking experience.
Earlier this year he worked on the aborted float of Russian coking coal producer Koks. In 2007, he worked on the $8bn float of Kremlin-backed lender VTB. Roger Barb, managing director in equity capital markets, is also working on the deal for Citi.
Renaissance Capital is also acting as joint global coordinator and bookrunner on the float. Equity sales director Jonathan Williams is working on the listing from London. The bank’s deputy chief executive in Russia, Alexander Merzlenko, is working on the float from Moscow.
Credit Suisse, Troika Dialog and BMO Capital Markets are also acting as joint bookrunners on the deal.