Bloomberg. Artem Konstandian: Russia’s Promsvyazbank Mulls Stake Sale Before $1 Billion IPO
March 27 (Bloomberg) -- OAO Promsvyazbank is considering selling an equity stake in the lender before a $1 billion initial public offering later this year in London and Moscow. “There may be a private transaction first,” Artem Konstandian, president of Promsvyazbank, said in a March 21 Moscow interview. “In case it is substantial, it might potentially delay the listing as we would use this fresh capital to produce even better results before an IPO.” Foreign and domestic investors are interested in the bank, Konstandian added, without giving details. Billionaire brothers Alexei and Dmitry Ananyev, who own 73.9 percent of the Moscow-based bank, are paying about 150 million euros ($194.2 million) to acquire an additional 14.4 percent stake from Commerzbank AG, Germany’s second-largest bank. Apart from the Ananyevs, the European Bank for Reconstruction and Development owns an 11.8 percent of Promsvyazbank. Commerzbank acquired its stake in 2006. Promsvyazbank is waiting to see whether OAO Sberbank, Russia’s largest lender, goes ahead next month with a secondary offering of its shares. Sberbank plans to start marketing about $5.7 billion of shares on April 16, people with knowledge of the process said. The deal by Sberbank, which is seen as Russia’s proxy stock, could open up the market for closely held banks seeking to sell shares, Konstandian said. “If Sberbank does their listing in the coming months, it would be very prudent for any privately owned banks to go to the markets based on the success and the benchmark by a state bank,” he said. Nomos Bank IPO The Promsvyazbank deal would be the biggest among Russian private banks since Nomos Bank raised more than $700 million in an IPO last April. As part of its plan for the IPO, the bank hired Neil Withers, vice chairman at merchant bank Silk Route Financial and former vice president at VTB Group, in January to head investor relations. Promsvyazbank canceled IPO plans in late 2008 to raise as much as $1 billion selling a 25 percent stake after markets plunged following the collapse of Lehman Brothers Holdings Inc. and Russia’s five-day war with Georgia. The bank said last week it more than doubled its net income in 2011 to 5.2 billion rubles ($180 million) from 2.5 billion rubles from the previous year. The lender is seeking to grow its consumer and small- to medium-sized client segments to 25 percent each of its total business from 9 percent each. “Our strategic target is 50 percent corporate and the rest equally split between SME and retail, which brings higher margins for the bank,” Konstandian said.
The bank stopped lending to retail customers from late 2008 until mid-2010 as it tried to deal with “a higher level” of non-performing loans. Half of the bank’s growth in the SME segment came after the bank acquired loan portfolios last year from Bank Trust. Promsyvazbank will consider acquiring more portfolios on a “case by case basis,” Konstandian said.