Moscow: Major Russian agricultural group Rusagro said yesterday it would launch an initial public offering (IPO) in Moscow, becoming the latest in a line of Russian consumer sector firms to tap equity markets.
The company, controlled by senator Vadim Moshkovich, plans to raise around $400 million (Dh1.4 billion) through the listing, with around half the proceeds to go to the owner and another half reinvested in the firm, sources close to the deal have told Reuters.
The company, which produces every eighth spoonful of sugar consumed in Russia, plans to list shares on Moscow's two bourses — the Micex and the dollar-denominated RTS.
Rusagro, which also makes margarine and mayonnaise — a staple in Russian salads — and breeds pigs, said in a statement its owner would use part of the proceeds to buy newly issued ordinary shares under closed subscription, thus ploughing money back into the firm.
The roadshow is expected to start on April 28 and the price will be announced on May 13, a financial markets source told Reuters.
Part of current capital
The placement will be worth 28.6 per cent of current capital or 25 per cent of the post-IPO capital.
The company said it made a profit of 2.3 billion roubles (Dh290 million) in 2009 on sales of 24.7 billion roubles, but did not indicate how much it planned to raise from the listing.
It has applied to the Russian financial markets authority to register a closed subscription for 11.4 million ordinary shares.
Russian companies are flooding to domestic and international markets with bonds and share placements after a cash drought during the country's first recession in a decade. Analysts say IPOs this year could exceed $20 billion.
So far, UC Rusal, the world's biggest aluminium producer, has already raised $2.2 billion in a January Hong Kong listing.
Next up is seafood firm Russkoye More which is set to complete an $170 million placement in Moscow this week. The Russian government is pushing for greater domestic food production and processing to reduce reliance on imports — a drive which could potentially benefit companies like Rusagro.
