OAO Sitronics, the technology unit of Russian billionaire Vladimir Yevtushenkov's AFK Sistema, plans to use about $100 million from its share sale to finance acquisitions and new projects this year.
Moscow-based Sitronics, which makes consumer electronics, telecommunications equipment and develops software, raised $402 million last week by selling 17.5% of its stock at 24 cents a share, the bottom of the offered range. The placement valued the company at $2.3 billion. About 20 companies are „in our pipeline” as Sitronics considers acquisitions, CEO Yevgeny Utkin said in an interview in London. „Our main focus is our home market in Russia, the CIS and eastern Europe.” Sitronics global depositary receipts, which represent 50 ordinary shares, and were sold at $12 apiece, began trading today in London. Ordinary shares began trading in Moscow on the dollar-denominated Russian Trading System and ruble-denominated Micex index. Sitronics shares rose 5.6% to 23.8 cents on RTS at 3:35 p.m. Moscow time. The shares rose 1.8% to $11.80 in London at 1:21 p.m. local time. „The shares trade at the level close to the placement, which supports the fairness of the IPO price,” Konstantin Belov, an analyst with UralSib Financial Corp. in Moscow, said in a telephone interview today.
The company, which also makes tickets for the Moscow subway and microchips for Russian missile systems, has offices in 25 countries and manufacturing facilities in Prague and Athens. Sitronics is the first Russian technology company to sell shares and is the fifth within parent group Sistema to do an IPO. Utkin said the biggest buyer in the IPO was a Washington, D.C.-area investment fund. Russian funds also were buyers, he said without elaborating. The IPO's results were in line with Sitronics' management's expectations, Utkin said. Sitronics said last month that it hoped to raise between $500 million and $550 million.
In so-called conditional trading, the global depositary receipts dropped more than 8% in their London trading debut on February 7. Yesterday the GDRs closed at $11.59. Russian companies are raising record amounts of money in stock and bond sales as they seek foreign acquisitions amid a ninth year of economic expansion. Sitronics is among about 30 Russian companies that may raise $20 billion this year in IPOs, according to Deutsche Bank AG's Moscow unit. An additional $15 billion may come from as many as 30 secondary offerings. Sitronics CEO Utkin said the company will spend $150 million of the IPO proceeds to repay debt. (Bloomberg)