EVRAZ, the Russian metals and mining group backed by billionaire oligarch Roman Abramovich, is moving its domicile to the UK and listing in London as it seeks greater international acceptance and access to capital.
Evraz, which mines coal, iron ore and valladium and makes steel industrial goods, yesterday said it wanted to list on the London Stock Exchange’s premium market and hoped to be added to the FTSE 100 index to raise its profile with global investors.
The move will see investors exchange their global depositary receipts for shares in Evraz, which is one of Russia’s biggest industrial companies and has expanded its global operations rapidly in recent years.
Evraz is the latest in a series of Russian firms seeking to list in London to access the deeper and more liquid markets despite the strict controls.
“We will be the same company but with a better platform for growth,” Evraz’ chief financial officer Giacomo Baizini told investors on a call.
Chief executive Alexander Frolov said it was keen to adopt the UK’s more stringent corporate governance standards, and had expanded its board to include four independent directors, including Sir Michael Peat, one of the founders of KPMG. A fifth independent non-executive may also be added to the board to equalise the numbers with the non-independent directors.
The GDR exchange is expected to close by 4 November, in order to meet the agenda for the next LSE meeting, which could add them to the FTSE 100 index by December.
Abramovich invested in Evraz in 2006, buying 42 per cent via Lanebrook, an investment vehicle he co-owns with Frolov and Evraz’s chairman Alexander Abramov. Lanebrook now owns 72.25 per cent of Evraz and is backing the plans.
MEET THE ADVISERS
MORGAN STANLEY, CREDIT SUISSE
MORGAN Stanley and Credit Suisse are joint sponsors of the Evraz listing, with experienced bankers on both sides. Gergely Voros, Morgan Stanley’s co-head of investment banking in Russia, is heading its team, while Credit Suisse’s side is led by its UK chief executive James Leigh-Pemberton.
Voros spent 12 years with Morgan Stanley in London before moving to Moscow for his new role in Moscow in April 2010. He has worked on high-profile floats such as state-owned oil giant Rosneft’s blockbuster $10.5bn listing in 2006.
He has also experienced the rough end of rocky markets, being forced to pull the planned $1.5bn listing of Russian precious metals miner Nord Gold in February as investors abandoned risky stocks.
Leigh-Pemberton works on CS’s highest-profile clients, which range from Nat Rothschild’s Bumi to Barclays and insurer Resolution.