Bloomberg News

Russia’s Main Bourse Seeks $502 Million in Moscow Share Sale

February 04, 2013

Shares of the Moscow Exchange, Russia’s main equity and fixed income bourse, will start trading Feb. 15 in the capital after an initial public offering expected to raise at least 15 billion rubles ($502 million).

The exchange is taking bids for the IPO starting today through Feb. 14 and won’t accept offers of less than 55 rubles a share, it said on its website today. The shares will trade under the MOEX ticker, according to an e-mailed statement from the exchange.

The offering in Moscow comes as foreign bourses lure trading volumes and share sales by Russian companies. The exchange, which runs Russia’s 50-stock Micex (INDEXCF) and dollar-based RTS indexes, set a maximum price of 63 rubles a share and plans to use the proceeds to boost the capital of its clearing subsidiary, the National Clearing Centre, and for information technology upgrades, according to the statement.

“This asset will only be interesting for strategic investors, major Western funds who invest in infrastructure projects,” Viktor Markov, an analyst at Kapital Asset Management LLC, said by phone from Moscow. “The exchange’s strategy is murky, it’s unclear what they’ll be using the IPO money for.”

Share Sale

Of the 15 billion rubles of stock being offered, 9 billion will be sold by existing shareholders through the exchange’s unit Micex Cyprus Ltd. and 6 billion rubles will be sold as new shares through Micex-Finance LLC, according to the exchange. Following the IPO, shareholders will be subject to a 180-day lock-up period, the statement said.

Shares will be sold in Russia, the U.S. and certain offshore locations, according to a bourse statement from Jan. 21. All the current exchange shareholders aside from Russia’s central bank will be able to sell shares in the IPO through Micex Cyprus, it said.

Russia’s Central Bank holds 22 percent in the exchange, while state-controled OAO Sberbank holds 9.6 percent, and Vnesheconombank, Russia’s development bank, holds 8 percent, according to the exchange’s website.

2012 Dividends

The bourse may increase the size of the offering by as much as 5 billion rubles, depending on investor demand. The exchange plans to pay no less than 30 percent of net income under international financial reporting standards as dividends for 2012, no less than 40 percent for 2013 and no less than 50 percent for 2014, according to today’s statement.

The exchange’s nine-month net income rose 22 percent to 6.4 billion rubles from the same period a year earlier, according to an e-mailed statement on Jan. 18. The revenue for the same period climbed 37 percent from a year earlier to 15.9 billion rubles, according to the statement.

Credit Suisse Group AG (CS:US), JPMorgan Chase & Co., Sberbank CIB and VTB Capital are organizing the IPO, the exchange said in the Jan. 21 statement. Deutsche Bank AG, Goldman Sachs Group Inc., Morgan Stanley (GS:US), Renaissance Capital and UBS AG’s investment bank are joint bookrunners.

The exchange had 2.197 billion shares as of Sept. 30, 2012, according to the Moscow Exchange’s website. With the IPO price range, that would put the total valuation at more than 120 billion rubles.

Trading Volumes

Trading volumes on the Micex Index halved in December from a year earlier, while the 30-day average value of trades in 10 Russian companies tracked by Bloomberg in London is about 59 percent higher than the same companies’ Moscow-listed shares. The comparison includes OAO Gazprom, OAO Lukoil and eight other companies with at least five years of history in both markets.

In September, Sberbank raised 159 billion rubles as Russia’s central bank reduced its stake in the country’s largest lender. The company received 2.9 percent of that amount from selling the stock on the Moscow Exchange, with the remainder placed in London, according to a statement from the Moscow Exchange.

OAO MegaFon, Russia’s second-largest mobile-phone provider, has rallied 19 percent in London since raising $1.7 billion in November in the biggest IPO by a Russian company in three years

To contact the reporter on this story: Ksenia Galouchko in Moscow at kgalouchko1@bloomberg.net

To contact the editor responsible for this story: Wojciech Moskwa at wmoskwa@bloomberg.net


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Companies Mentioned

  • CS
    (Credit Suisse Group AG)
    • $26.39 USD
    • 0.21
    • 0.8%
  • GS
    (Goldman Sachs Group Inc/The)
    • $189.59 USD
    • -0.16
    • -0.08%
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