Moscow gets ready for return of the IPO

The Moscow Stock Exchange  may host up to 12  IPOs and SPOs  next year and various unnamed firms are actively considering raising capital there next year, VTB Capital’s co-head of global banking Alexander Metherell told Reuters this week. If correct, it would signify a reversal of a trend that has seen Russian firms flock to capital markets in London and New York in recent years and would demonstrate the business community’s renewed confidence in the domestic economy; after two years of contraction the central bank is now predicting a 2% growth  this year.
“I think you’ll see two or three [IPOs or SPOs] on the consumer-retail side and you’ll definitely see a couple on the mining side, maybe also in the transport and infrastructure sectors,” Metherell said and suggested that the first listings  could take  place as soon as companies published their year-end results and audited them.
“If people are really quick, you may see something coming out in April, but it’s more likely to be in the second quarter rather than in the first quarter,” Metherell said. 2017 been “a turning point in terms of investors saying they wanted to have greater exposure to Russian assets,” he added.
With the Russian economy showing signs of recovery and the introduction of new settlement systems and a central securities depository on the Moscow Exchange helping to reduce risks for market participants and increase overall transparency, foreign investors  have already been making a cautious return despite Western sanctions over the Ukraine conflict.
Earlier this year, the Detsky Mir toy store became the first Russian company to go public since 2013  and this month the Obuv Rosii shoe retailer raised around $105m; but the most significant IPO currently on the cards that of  EN+ metals and energy that is owned by billionaire Oleg Deripaska who is hoping to raise $8.5bn on the London and Moscow stock exchanges.

Source: reuters