Russia’s Global Ports plans $750-million IPO

Russia’s Global Ports is seeking up to $750-million (U.S.) from an initial public offering of shares in London, a source close to the deal said, the latest Russian firm to raise funds from capital markets.

The company, a unit of private transportation and infrastructure holding group N-Trans, said it would issue $100-million of new shares and N-Trans would sell an unspecified number of existing shares to deliver a free float of 25 per cent.

A source close to the deal said analysts had calculated a “fair value” for the company of around $3-billion, meaning a total of $750-million could be raised from the IPO if investors agree on the sums.

“There will be a significant secondary component to the offering, although the public market will determine the final valuation,” the source said.

The company, which controls around 30 per cent of Russia’s container ports market, said it will invest the net proceeds from the sale of the new and existing shares in its ports operation.

Russian companies have raised $3.4-billion from IPOs in 2011 to date, compared with around $5.5-billion during the whole of last year.

The standout deal was the blockbuster $1.4-billion Nasdaq IPO of Russia’s most popular search engine Yandex last month, but there have been more cancellations than successes as investors remain wary of perceived risks surrounding Russian firms.

The Global Ports announcement came as French luxury goods firm Moncler cancelled plans for a stock-market float after investment company Eurazeo agreed to buy a 45 per cent stake.

Fashion house Prada is pushing ahead with its long-held IPO plans, setting a price range that could fetch up to $2.6-billion in Hong Kong.

Global Ports could become a third successful IPO from the N-Trans company following the floats of freight operator Globaltrans Investment and road and bridge operator Mostotrest.

Mostotrest raised $388-million in Moscow last November, although the shares have since lost ground.

Global Ports said its revenue grew by 61 per cent to $122.9-million in the first quarter of this year, while earnings before interest, tax, depreciation and amortization more than doubled to $67.3-million.

The Russian container ports market has grown by 18.6 per cent on an annual basis since 2000 and is expected to continue at a similar rate, the company said, citing Drewry Shipping Consultants.

Global Ports hired Deutsche Bank, Goldman Sachs, Morgan Stanley and Troika Dialog as joint organizers of the offering.