PhosAgro valued at $6 bln-$8.6 bln, owner stakes revealed
MOSCOW. June 15 (Interfax) - Troika Dialog , one of the organizers of a forthcoming IPO for PhosAgro, has valued the Russian fertilizer producer at $6 billion-$8.6 billion prior to the offering, the organizer said in an analytical note.
PhosAgro officially announced its intention to hold an IPO in London and Moscow on June 14. The fertilizer producer said in a statement that it would offer existing ordinary shares to Russian investors and shares and Global Depositary Receipts (GDR) to institutional investors outside the country.
A banking sector source told Interfax on June 14 that a road show would begin in June 29 and that pricing was due on July 15.
PhosAgro said the selling shareholders will be a group of PhosAgro shareholders, which may include Chlodwig Enterprises Limited, Miles Ahead Management Limited, Adorabella Limited, Dubhe Holdings Limited and Fornido Holding Limited.
Each GDR represents 30 shares.
A source has told Interfax that the company might sell up to 10% of its shares and that it had a market cap of $6 billion-$8 billion. Maxim Volkov, the general director, told a press conference on June 14 that 10%-15% could be sold.
The Federal Financial Markets Service (FFMS) has cleared PhosAgro to have 2.662 million shares or 21.35% of its issue shares traded as GDRs. Its shares have been included on Russia's MICEX B list and have been admitted to trading on the RTS stock exchange.
The company has disclosed that Andrei Guryev, Federation Council member for the Murmansk region, and members of his family are its beneficiaries.
Troika Dialog said in its June 15 analytical note that Guryev controlled 81% of PhosAgro and that Vladimir Litvinenko, rector of the St Petersburg State Mining Institute, was the second biggest shareholder with 10%. Former PhosAgro chief Igor Antoshin owns 7%, Maxim Volkov, the general director, owns 1%, and 1% of shares are held in treasury.
Maxim Volkov told reporters on June 14 that shares would be offered only by companies whose beneficiaries are Guryev and members of his family. He did not specify how many shares Guryev and his family owned, only that this was "a majority stake."
If 10%-15% of the shares in PhosAgro are sold, then Guryev and his family will be left with 66%-71%.
PhosAgro disclosed its shareholders to some extent in a share prospectus in the past. It said Litvinenko had owned preferred shares representing 5% of issued shares, since 2007, and Antoshin - 1.99%. The prospectus said Volkov owned 1% and that Yevgenia Guryeva (Andrei Guryev's wife is called Yevgenia) had owned 5.01% since 2007.
Volkov did not say on June 14 what the IPO proceeds might be used for, only that one potential purpose was to obtain "currency for potential M&A deals." PhosAgro is "not currently discussing an M&A deals," but further consolidation in the industry is possible, and the company will be looking at "all mergers and acquisitions that may be of use to our company and its stakeholders."
Volkov recalled that PhosAgro had offered to swap its shares for the government's stake in Apatit . "We aren't going back on our word," he said, adding that no decisions on this score had yet been reached. "We'll be hoping that if we have a successful placement then we'll remove at least one of the unknowns in this area," Volkov said.
Troika Dialog says the government currently owns 26.7% of Apatit (20% of issued shares). The stake is worth $530 million and has been included in the 2011-2013 privatization fund. Troika says others may be interested in the take besides PhosAgro. PhosAgro might be interested in swapping shares in Apatit for shares in the holding itself. That would minimize the cash consideration for the shares and mitigate any related risks. PhosAgro's market valuation might be used for the purposes of the swap. The government could in time put the PhosAgro shares on the market, the analysts say.
PhosAgro boosted net profit to International Financial Reporting Standards (IFRS) 70% in 2010 to 10.578 billion rubles. Sales revenue grew 26.6% in 2010 to 76.951 billion rubles.
