Page 81 - RusRPTApr19

Tomsk Distribution Co RUB 0,4 4 0,017 4,8% 0,017 4,8% Medium pref
Kubanenergo RUB 70,6 346 0,928 1,3% 0,928 1,3% Low
Source: Bloomberg, ATON Research
8.3.3 ECM news
Crispian Investments of Russian billionaire Roman Abramovich and Alexander Abramov held an overnight accelerated book-build for secondary public offering (SPO) of a roughly 1.7% stake in metals major Norilsk Nickel. This made the largest offering in the metals and mining sector this year, VTB Capital told Vedomosti daily on March 12. UK investors accounted for the most bids (39%), with Russian investors following (33%). While initially 1.25% was up for sale, the offer was increased. Selling at RUB1,345 per share (6.5% discount to the market), this translated a deal of about $533.5mn. BCS Global Markets see the offer as slightly overpriced due to several downside risks in base metals prices, expecting nickel price to decline on the back of an anticipated fall in steel prices (the metal is mostly used in stainless steel production). The analysts also note that Crispian Investments has about 2.5% left in the company, hence overhang risk will persist in the stock from now on, being another negative factor. Free float should increase the about 32.9% after the deal. Last year, Crispian tried to sell a 4% stake in Norilsk to Interros of Vladimir Potanin for $234 per share, but Rusal blocked the deal through a London court, Sberbank CIB reminded on March 12. The latest SPO banned any affiliates of both Interros and Rusal from participating. Sberbank estimates the deal price as having a 12% discount to last year's unrealized Crispian/Interros deal and just a 3% discount if dividends paid in 2018 are taken into account. The bank believes the deal is "opportunistic, price-driven and reflects Abramovich's earlier intention to monetize his investment." At spot commodity prices and the current USD/RUB exchange rate, the offering price implies a 5.8x 2019 estimated Enterprise Value to Ebitda multiple and an 8.5% leveraged FCF (free cash flow) yield, which Sberbank sees as attractive reiterating a Buy recommendation on Norilsk Nickel shares.
Petrochemicals company and the largest producer of synthetic rubber in Russia Nizhnekamskneftekhim (NKNH) saw its stock price skyrocket after the board recommended paying 150% of net profit in dividend for 2018, making a total payout of RUB36.5bn ($554mn).
81 RUSSIA Country Report April 2019 www.intellinews.com