Russian MinFin expects 10-12 public share offerings in 2025

MOSCOW. April 2 (Interfax) - The Russian Finance Ministry expects 10-12 public share offerings in 2025, Deputy Finance Minister Ivan Chebeskov said at the Strategic Financial Market Session forum organized by Expert RA.

He said there had been 15 initial and four secondary public offerings in 2024.

"This year we can probably expect less, perhaps 10-12 companies for now," he said.

Chebeskov said companies were waiting for the key rate to start coming down before making their market debut. "This has a big effect on a company's valuation, and many issuers are either waiting for the end of the year, or maybe next year," he said.

"Among state-owned companies, we have already said that this year, closer to the end of it, we are planning to float a government-related company with state participation, DOM.RF. This will be the first IPO, where we plan to test all the innovations that we are currently working on," he said.

"First of all, this is, of course, a change in the company's corporate governance, because it is obvious that a wholly state-owned company has different corporate governance than a totally public company. Basically, it's governance by directives, boards of directors are dominated by government officials, and this has to be changed. So soon, I hope, the DOM.RF board of directors will be changed, and more market-based corporate governance principles introduced," Chebeskov said.

Management incentives are another key factor for a successful market flotation. "When we ask any consultant what is the most important thing to do for government-related to get them interested in IPOs, floating their shares, they say change the management incentive system, that is, tie the management incentive system to the share price. This is much easier said than done, believe me. This has proven to be one of the hardest tasks, to carry out all these procedures and make the necessary decisions. We are currently working on such scenarios," Chebeskov said.

He said the Finance Ministry hoped the changes at DOM.RF would become a kind of benchmark for future share offerings by government-related companies. He said the ministry expected to do privatization deals for seven to 10 state companies in 2026, and preparations for this would have to get underway this year.