Sibanthracite investors to tap London market

 
Suzie Neuwirth
SIBANTHRACITE is the latest Russian company to try its luck on the London market, as it yesterday announced its plans to float.

The niche coal miner said that shareholder GLG Partners is looking to sell its 25 per cent stake through a public offering on the main market of the London Stock Exchange.

While no specific time frame been given, it is believed that the initial application will be made in the next two weeks, with a view to listing in the second half of this year. Sources have said the stake sale could raise up to $200m (£128m).

Twenty per cent of the proposed offering will be reserved for existing shareholders of the GLG Emerging Markets Growth Fund.

It is understood that GLG bought its stake in the Russian miner in 2008 with a view to bringing it to market, but its plans were stalled by the economic downturn and a lack of investor appetite for initial public offerings (IPOs).

Analysts have warned that Sibanthracite may still find it challenging to attract investors, with coal prices hitting a four-year low this year.

The latest Russian firms to float in London were telecoms company Megafon last November and private women’s and children’s healthcare chain MD Medical Group last October.

Megafon’s long-feted IPO had a disappointing debut with shares priced at the bottom of the range, but has gone up 62 per cent since then.

Sibanthracite mines a rare form of coal in the central Siberian region of Novosibirsk called ultra high grade anthracite (UHG), which can be used as a substitute in steelmaking for coke made from baked coking coal.

Last year the firm posted a 27 per cent increase in revenues to $508m (£325m) and net profits up 22 per cent to $117m.

“UHG anthracite is a unique product that is of growing global importance. We have worked hard to build an independent, export-oriented company, and are well positioned to benefit from rising demand for high-quality anthracite,” said chief executive Dmitry Shatokhin.

“This transaction will give investors a unique opportunity to gain exposure to the highly attractive and steadily growing global anthracite market.”

ADVISERS | SIBANTHRACITE
MARTIN SCHWEDLER
RAIFFEISEN BANK

JP Morgan, Morgan Stanley, Raiffeisen Bank and Sberbank are acting as joint global coordinators and joint bookrunners on the planned offering.

The Raiffeisen team was led by equity capital market investment bankers Martin Schwedler and Ilya Tuzov in Moscow, as well as Siegfried Neumuller and Michael Siller in Vienna. Schwedler has headed up investment banking at Raiffeisen since August 2011. He was a member of Raiffeisen’s executive board from 2002 to 2011 and was responsible for Russia, Turkey, Poland, Romania and Hungary.

Prior to joining Raiffeisen he held senior roles at private equity firm GE Capital Group.

Tuzov is an associate director at Raiffeisen, having joined in November last year. He has extensive experience in the investment banking field, working on deals totalling over $12bn, and has worked in each of the three major sell-side areas: M&A, equity capital markets and debt capital markets, both in Russia and abroad. He previously worked at Troika Dialog, which is now part of Sberbank. Prior to that he held positions at Alfa Bank and Citi.

There is a fair amount of overlap between the advisers of this deal and the two latest Russian firms to float on the London market. JP Morgan worked on the MD Medical Group IPO last October, while Morgan Stanley and Sberbank acted as joint coordinators on the Megafon flotation last November.