Fix Price raises $1.7b in Russia’s largest IPO

Bloomberg

Fix Price’s initial public offering in London and Moscow raised $1.7 billion, on track to be the biggest listing from a Russian company in more than a decade, possibly prompting more share sales from local issuers.
Russia’s largest dollar-store chain priced 178 million global depositary receipts, representing one ordinary share each, at the top end of an initial $8.75 to $9.75 range, according to a statement. The retailer opened at $9.75 per global depositary receipt in London, matching the IPO price. Trading starts in Moscow on March 10. The sale values Fix Price at $8.3 billion and is the biggest listing for a Russian retailer ever.
Proceeds from Russian IPOs and secondary public offerings could reach more than $10 billion this year after a long fallow period, according to VTB Capital. This could make 2021 the biggest year for Russian share sales since before international sanctions were imposed on the country in the wake of its annexation of Crimea in 2014.
Online retailer Ozon Holdings Plc had a $1.3 billion US IPO in November, and more deals are lining up, with gold miners Nord Gold and GV Gold said to consider going public.
Fix Price could sell another 27 million GDRs from an over-allotment option, bringing the deal size to as much as $2 billion.
That would mark the biggest IPO from a Russian company since United Co. Rusal Ltd.’s Hong Kong listing in 2010, which raised $2.2 billion. If allocated in full, 24% of Fix Price’s total share capital will be publicly traded.
US investors accounted for about 40% of demand for the placement, with U.K. investors providing a third of orders and Russians about 10%, according to Boris Kvasov, co-head of equity capital markets at VTB Capital, which helped arrange the deal.
Fix Price, which uses a model similar to Dollar Tree Inc. in the U.S., has prospered as Russian wages have stagnated since the 2014 collapse of the ruble. It operates more than 4,200 stores and had revenue of 190 billion rubles ($2.6 billion) last year.
BofA Securities, Citigroup Inc., JPMorgan Chase & Co, Morgan Stanley and VTB Capital are joint global coordinators and bookrunners on the IPO.