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bne October 2021 Cover story I 39
Leading Russian insurer Renaissance Insurance Group announces an IPO with $1bn valuation as Russia's listing boom continues.
Russia's Renaissance Insurance hopes to raise $290mn with IPO
However, Jordan left Rencap, selling his interests to his partner Stephen Jennings, but retained ownership of Renaissance Insurance in the deal, which is now owned by Jordan’s Sputnik Group. Jordan remains the company's president and board chairman. Oligarch Roman Abramovich’s Millhouse Capital is also an investor in the company.
“Today’s announcement represents
a landmark for Renaissance Insurance and a watershed moment in the history of the Russian insurance market. Becoming the first publicly-listed Russian insurer would be entirely fitting for a company that has always sought
to be ahead of the curve ever since we established it almost three decades ago,” Jordan said in the statement. “We were the first in our industry to recognise
the potential of digital transformation and have disrupted the market with
a business model that is high-tech, highly efficient and highly profitable. Digitalisation has been the core
driver behind Renaissance Insurance delivering faster and more profitable growth than the overall market for
the past several years, including during the coronavirus [COVID-19] pandemic.”
Boris Jordan’s Sputnik Group
and partners own a 59% stake in Renaissance Insurance, and a group of investors linked to Abramovich and some of his business partners bought almost 30% in the company in May of this year. Other shareholders include US fund manager Michael Calvey’s Baring Vostok Capital Partners.
The Renaissance companies together had 4.5% of the Russian insurance market in the first quarter, according to Expert RA ratings agency, as cited by Bloomberg.
Russian IPOs have come thick and
fast in the last 12 months as investors look to tap into the country’s bounce- back and buy into the rapidly growing e-commerce and finance sector. Russia’s leading RTS index is up around 30% year to date, but the banking sector stocks are up 60% in the same period.
Ben Aris in Berlin
One of Russia’s leading privately owned insurance companies, Renaissance Insurance Group, has announced that it will IPO on Moscow Exchange (MOEX), the company said on September 27.
“Renaissance Insurance Group JSC,
a Russian diversified independent insurance company, today announces
its intention to conduct an initial public offering of ordinary shares and to list on Moscow Exchange,” the company said in a statement. “The Offering is expected to comprise an offering of the Ordinary Shares (i) in the Russian Federation, (ii) otherwise outside the United States in reliance on Regulation S (“Regulation S”) under the US Securities Act of 1933, as amended (the “Securities Act”), and (iii) within the United States to certain qualified institutional buyers (“QIBs”) as defined in, and in reliance on, Rule 144A (“Rule 144A”) under the Securities Act.”
The company said it hopes to raise RUB21bn ($290mn) with the primary offering and a secondary offering where
some of the shareholders will cash out. “Proceeds from the primary component of the Offering will be used to accelerate the Group’s development by financing organic growth, investments in further digital initiatives, potential value- accretive acquisitions and the possible repurchase of shares following the results of stabilisation in connection with the Offering,” the company said.
Previously a source close to the company told Reuters that it hopes to raise $250mn and achieve a valuation of $1bn. The IPO will be led by JP Morgan, Credit Suisse and VTB Capital (VTBC) as global coordinators to work on the deal.
Renaissance Insurance is one of the oldest privately owned companies on the market, having been set up in 1997 by famous financier Boris Jordan, a US banker who made a fortune during the privatisation process in the early 1990s while at Credit Suisse. He went on to found the investment bank Renaissance Capital (Rencap), a doyen in the early days of Russia’s capital markets.
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