ChelPipe must complete London IPO by May 15 - sources
MOSCOW. April 26 (Interfax) - Chelyabinsk Tube Rolling Plant (ChTPZ) has until May 15 to complete its IPO, according to London Stock Exchange regulations, a banking sector source told Interfax.
Another source said the placement would begin on or around May 10.
This will be the company's second attempt at an IPO. The first was aborted in February due to poor market trends.
The price range at the time was $3.5-$4.6 per share and GDR. The company planned to sell around 30% of its shares in the IPO on the MICEX, RTS and LSE and to raise $630 million-$828 million. The IPO would have valued the company at $2 billion-$2.7 billion.
The company and its subsidiaries planned to raise between $472.5 million and $621 million from the supplemental placement and sale of existing treasury shares. ChelPipe's main beneficiary expected to raise from $157.5 million to $207 million from the sale of existing shares.
The global coordinators were JP Morgan, and the joint managers will be Bank of Moscow , Gazprombank, and Raiffeisenbank. JP Morgan had an over-allotment option for $51.1 million-$67.1 million in GDRs.
Some of IPO the proceeds would have been used to pay off debt.
The price range this time could be the same as last time - between $3.5 and $4.6 per share and GDR, which would value the company at $2 billion-$2.7 billion, UralSib Capital analyst Dmitry Smolin has said.
Smolin said the other aspects of the IPO might also be the same as last time - the company might again try and place 135 million new shares and treasury shares (29% of shares) and existing shareholders might offer 45 million shares. The IPO volume could be $630 million-$828 million.
Smolin said a fair IPO price for investors would be the lower range of $3.5 a share, which implies a 30%-discpunt against rival pipe maker TMK , based on EV/EBITDA for 2011.
Smolin said the ChelPipe IPO might be a short-term negative for TMK because some investors might switch to ChelPipe in order to balance their portfolios.
ChelPipe is the flagship enterprise of the ChTPZ pipe and metals group, which includes Pervouralsk New Pipe Plant (PNTZ) ; LLC Meta, a company specializing in scrap metal collection and processing; metal trading company Uraltrubostal Trading House; and oil industry services provider Rimera. Arkley Capital manages ChTPZ Group's assets.
ChelPipe's IPO prospectus says Andrei Komarov controls around 73% of the company: he owns 95% of Mountrise, which owns 76.8% of ChelPipe and was the selling shareholder in the IPO. ChelPipe's general director, Alexander Fyodorov, owns 8.1%: he owns 5% of Mountrise and all of Poweredge, which owns 4.3% of ChelPipe.
ChelPipe boosted pipe production 63.8% year-on-year in Q1 2011 to 311,800 tonnes. PNTZ raised it 20% to 187,100 tonnes.