31 Mar 2010 17:47

Protek IPO underwriter values company at $2.16 bln-$2.38 bln

MOSCOW. March 31 (Interfax) - Renaissance Capital, which one of the organizers of an IPO for Protek, values the Russian pharmaceuticals company at $2.16 billion-$2.38 billion, the investment company said in an analytical note.

Protek intends to raise $400 million with an IPO in May-June, the pharmaceuticals group's president, Vadim Muzyaev, said on March 30.

"We can't say when precisely the deal will be closed, but it will be in May-June time," Muzyayev said.

The size of the IPO will depend on demand for shares. "We plan to raise around $400 million," he said, adding that shares would be placed on Russian stock exchanges only.

Muzyayev said around half the IPO proceeds would be reinvested in the company by buying up supplementary shares in a private subscription.

The proceeds will be invested in the manufacturing segment, including R&D, and the expansion of the brand-name portfolio. Protek also plans to invest in the retail segment, which will grow both organically and via mergers and acquisitions, Muzyaev said.

He said group earnings before taxes, depreciation and amortization (EBITDA) rose 70% last year compared with 2008 to 5.837 billion rubles. Sales rose 18% to more than 91 billion rubles, including 82 billion rubles in the distribution segment.

The Russian pharmaceuticals market in general grew 18%, despite the crisis. It grew from 365 billion tonnes to 538 billion rubles in ruble terms in 2007-2009.

Muzyayev said the group intended to outperform the market in all three segments - distribution, manufacturing and retail. He said the group expected the Russian pharmaceuticals market to increase 10%-12% in ruble terms in 2010.

Protek said in a statement that Renaissance Capital and UBS Investment Bank will be joint global coordinators and bookrunners for the IPO and that the selling shareholders would be Tantarra Holdings Limited and Streitum Investments Limited.

The Protek Group includes wholesale distributor CV Protek; pharmacy chain Rigla, Russia's second biggest by revenue; and four manufacturing companies, including Sotex.