DOM.RF not planning additional share issues in coming years after IPO
MOSCOW. Nov 17 (Interfax) - DOM.RF, which is currently in the process of placing new shares as part of an IPO, does not plan to conduct additional share issues in the coming years, expecting to build a long-term investment case, said Alexei Pudovkin, managing director and member of the state company's board.
The lock-up obligation, which DOM.RF undertakes as part of the placement, has a six-month term. During a conference call between the company's senior management and investors on Friday, a question was asked about further plans on this issue and the risks of diluting future minority shareholders, a participant in the call told Interfax.
Pudovkin replied that DOM.RF is entering the market "not in order to stumble at the first step."
"And we must let the market get used to us, these are the basic premises. If these premises are successful, it is a matter of three to four years, then maybe the company, if it maintains a growth rate of plus 20%-25% and sees that there is market potential... But this is definitely not being discussed in the coming years. That is certain, because there is sufficient capital, and the essence of the IPO is to open up and switch to market principles, and to lay down a different vector of development. We do not see any prerequisites for the necessity," the source quoted Pudovkin as saying.
The management gave assurances that the Russian state, as the main owner of DOM.RF, does not plan any actions with the shares and has not included the company in the privatization plan.
On Friday, DOM.RF opened an order book for participation in an IPO, setting a price range from 1650 rubles to 1750 rubles per share, in line with the company's market capitalization of between 267 billion rubles and 283 billion rubles, excluding funds which it plans to raise in the IPO. Bookbuilding will continue until 13:00 on November 19. VTB Capital Trading is acting as the broker.
DOM.RF will place no less than 20 billion rubles in the IPO. JSC Astra UA, JSC VIM Investments, JSC UK Ingosstrakh-Investments and other anchor investors plan to purchase shares totaling 10 billion.
The company intends to use all funds raised during the placement to implement its strategy to develop business. The Russian government, as a shareholder of DOM.RF, does not intend to sell its shares during the IPO.
The company's supervisory board will set the IPO price once bookbuilding has finished. Trading is expected to start in shares listed on the Moscow Exchange on November 20 under the ticker DOMRF and ISIN RU000A0ZZFU5. The shares are expected to be included in the Moscow Exchange's tier 1 quotation list.
The company is considering the priority allocation of up to 100% of shares for DOM.RF employees and anchor investors.
