Sberbank sale met by high investor demand

Tim Wallace
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STRONG demand for Sberbank stock has kept the share price up despite the Russian central bank selling a huge stake in the firm this week.

The central bank is offloading a 7.6 per cent stake, worth $5.2bn (£3.2bn) after pricing shares at 93 rubles last night.

That sale will take the state’s holding in the country’s largest bank to 50 per cent, plus one voting share.

The investment banks working on the deal are thought to have covered their order books well ahead of closing time yesterday.

As a result, shares are likely to be allocated to buyers today, and the deal closed.

The guide price had earlier been raised to between 92 rubles (£1.83) and 94 rubles per share from an initial lower bound of 91 rubles on the strong demand.

Russia’s central bank is believed to have been looking to sell the stake for the last year, but only now has found suitable market conditions for the placement.

The combination of QE3 from the Federal Reserve, the new bond-buying policy from the European Central Bank and the approval of the European Stability Mechanism bailout fund by Germany’s top court has provided a strong boost for markets.

And investors, starved of big offerings in recent months, have lapped up the change to buy big stakes in a major institution in a relatively healthy emerging market.

The vast majority of the sale is taking place in London in the form of global depository shares, each representing four ordinary shares, while the remaining 10 to 15 per cent is being sold in Moscow.