6 Apr 2010 16:42

Sberbank to consider DR placement in H2 2010

MOSCOW. April 6 (Interfax) - Sberbank will consider a depositary receipts (DR) placement in the second half of 2010, the bank's chairman, German Gref, told reporters.

"We'll probably discuss this with directors in the second half," Gref said.

It was reported earlier that legal amendments taking effect in mid-March altered the procedures for converting shares into DR for A-listed companies. The changes enable Sberbank to issue depositary receipts on a minority stake.

Usually when a depositary program commences, there are shareholders willing to have their shares converted into DR, in which case it is clear what the volume of the depositary issue will be. Under the "zero" program, it is not known beforehand how many shares will be converted into DR or whether any shareholders will offer their shares for conversion.

The "zero" program is suitable for issuers with many small shareholders (those with less than 1% of shares), although minority shareholders with larger stakes can also participate, so long as the total in circulation abroad does not exceed 25% (the limit was reduced from 30% effective January 1, 2010).

A "zero" program is sponsored, that is, the issuing company signs a statement to give permission.

Until recently the owner of the shares was required to give written permission to convert the shares. If the owners did not want to sign, and take responsibility for offering the shares on exchanges in Russia and abroad, the shares could not be converted.

Sberbank has had plans to issue DR since 2007, but the program has been postponed a number of times.

The head of the Federal Financial Markets Service (FFMS), Vladimir Milovidov, said that under the previous rules, a major investor needed to receive permission from the FFMS before converting existing shares into DR. But Sberbank has no such investor, excepting the Central Bank. Instead it has many small shareholders. If those shareholders each applied for permission with the FFMS, Sberbank would have a difficult time overseeing the process.

Now Sberbank may receive permission to commence a "zero" program and collect statements from any minority shares, up to the limit of 25% of shares.

At a meeting with minority shares in November 2009, Sberbank's leadership said the bank planned to convert up to 15% of shares into DR, said Anton Danilov-Danilyan, the head of the committee for minority shareholder relations.

Sberbank Deputy CEO Anton Karamzin said at the end of February that Sberbank planned to launch a program to convert shares into DR in 2010.

"Tactically we have a very cautious approach to the timing. We don't want our shares to be used to inflate a stock market bubble. I hope that such a moment will present itself this year," Karamzin said.