Rusagro holding's shareholders do not approve redomiciliation to Russian Federation
MOSCOW. Sept 9 (Interfax) - The shareholders of Cyprus-based Ros Agro Plc, which is the holding structure of PJSC Rusagro Group, during an extraordinary general meeting voted not to approve the decision on redomiciliation to the Russian Federation.
"The company's redomiciliation from Cyprus to the Russian special administrative region (SAR) was not approved," the company said.
The EGM to vote on Ros Agro Plc's redomiciliation to the special administrative region on Russky Island, has been scheduled for August 30, but it was postponed until September 6 due to the absence of a quorum.
The Moscow Region Arbitration Court on September 5 satisfied the Russian Agriculture Ministry's claim against Ros Agro Plc to suspend the exercise of company's corporate rights in relation to its Russian subsidiary PJSC Rusagro Group.
The company was added to the list of economically significant organizations (ESO) in July. The Russian Agriculture Ministry is the plaintiff under law in cases that involve suspending the corporate rights of foreign shareholders of companies on the ESO list under its jurisdiction. The Arbitration Court of the Moscow Region hears and rules on the claims.
ESO status allows a company's Russian beneficiaries to receive securities and shares in the company into direct ownership through the courts excluding foreign holding companies from the ownership chain, or to transfer the rights to them to someone else. In addition, the document allows, through the courts, for the temporary suspension of the corporate rights of the foreign holding structure in relation to the ESO, for example, to vote at meetings, receive dividends, or dispose of securities and shares. In order to exercise this opportunity, a plaintiff must file an application with the court to suspend a foreign shareholder from exercising its corporate rights regarding the ESO.
Ros Agro Plc said in a press release on August 8 that if the court satisfied the AgMin's claim, then exercise of corporate rights of Ros Agro Plc in relation to the Subsidiary would be suspended, and the company would lose the ability to vote at shareholder meetings and dispose of shares of the subsidiary, as well as qualify for dividend payments. "In turn, the shareholders of Ros Agro Plc will have the opportunity for the subsidiary's shares distribution proportionally to their indirect share in the capital of PJSC Rusagro Group," it said.
Alexander Tarasov, director of corporate development of Rusagro Group, said earlier, commenting on the possibility of the AgMin filing a lawsuit against Ros Agro Plc, that "a lawsuit will actually launch the process of transferring the company from Cyprus to the Russian Federation, the conversion of Ros Agro Plc GDRs into shares of PJSC Rusagro, and all GDR holders will receive shares of PJSC."
The company also said that following redomiciliation it would return to the issue of paying dividends. The last time Rusagro paid dividends was for the first half of 2021, at $0.89 per share.
Dividend policy is to pay at least 50% of the group's net profit for a year.
The company's authorized capital comprises 27,333,333 shares, with one share equal to five GDRs. The main shareholder is the family of its founder, Vadim Moshkovich, with a 49% stake. Maxim Basov, former CEO of Rusagro and current shareholder, has an 8% stake.
The London Stock Exchange suspended trading of Ros Agro Plc's depositary receipts indefinitely in March 2022, and in June that year shareholders who held receipts through Russia's National Settlement Depository (NSD) were deprived of the ability to receive dividends and vote at company shareholder meetings.
In June 2022 shareholders approved the possibility of delisting Ros Agro's GDRs from the LSE and listing the company on another international exchange. The company's shares have traded on the Astana International Exchange in Kazakhstan since March 2023.
Rusagro is one of Russia's leading agricultural holdings. It ranks first in the production of sunflower oil and margarine, second in the production of sugar and industrial fats and third in pork.
Rusagro produced 334,000 tonnes of pork in live weight for slaughter in 2023, down 1% from 2022. Sugar production rose 20% to 928.000 tonnes. The Group's revenue increased 15% in 2023 to 277.3 billion rubles, adjusted EBITDA rose 26%, to 56.56 billion rubles, and net profit grew over sevenfold to 48.7 billion rubles.
The company has assets in 15 Russian regions, including the Belgorod, Tambov, Voronezh, Kursk, Oryol, Sverdlovsk, Samara, and Orenburg regions, the Primorye territory and others. The land bank is 696,000 hectares.