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Do Russia’s Q2 GDP Figures Show Light at the End of the Tunnel?
Posted on August 13th, 2009 Comments welcome Share/Save PrintWhen is a fall of 10.9% in GDP year-on-year good news? Perhaps when it represents a growth of 7.5% on the previous quarter.
The Russian economy has had a rough year, but information released on August 11 by Russia’s state statistics agency indicates that things may be levelling off.
According to the second quarter data, Russia’s GDP fell by 10.9% year-on-year but grew by 7.5% compared to Q1 09. But while the figures are giving rises to some cautious optimism, the emphasis is definitely on the word “cautious.” Yulia Tseplayeva, Chief Economist at Bank of America-Merrill Lynch in Russia, told The New York Times that “it is very likely that Russia has bottomed out and that recovery has started.” But at the end of June, the Russian government downgraded its overall GDP forecast for the year to predict an 8.5% decline, and unemployment and wage arrears remain major issues.
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Et Resurrexit? The Return of the Russian Equity Offering
Posted on June 16th, 2009 Comments welcome Share/Save PrintAfter 10 months of drought, there are now signs of life in the market for Russian equity offerings.
In the first Russian placement since Acron’s $2.7 million LSE technical listing in August 2008, Alliance Oil raised $390 million - $265 million through the sale of convertible bonds and $125 million through the sale of new shares listed on NASDAQ OMX Nordic. Riding on the back of rising oil prices, Alliance, formerly known as West Siberian Resources, exceeded its $325 million target with its June 12 fundraising.
Coupled with the fact that Russia’s RTS Index is currently the world’s best performing big market, up 70% year to date, Alliance Oil’s success is seen by some analysts as a bellwether for additional Russian offerings. Pavel Malyi, Executive Director of UBS in Russia, told Reuters that investors are “warming up not only to the debt markets but also to equities. Alliance Oil is a green shoot and in the second half [of 2009] there will be further activity.”
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No Water, No Float – Russian Regulator Set to Revise Listing Rules
Posted on June 8th, 2009 Comments welcome Share/Save Print
By Trevor Barton, Senior Vice President & Managing Director - Europe, The PBN Company, London
Close your eyes and cast your mind back to the heady days of 2007 when Russian companies made the record books, topping the European IPO league table by raising a total of $29 billion. That year, Russia’s Sberbank and VTB were the world’s largest flotations of the year, raising $8.8 billion and $8 billion, respectively.
Then came the global credit crisis, and during 2008 the flood turned to a trickle. In 2009, the ground has been parched, and we have had to content ourselves with the hope that Russian IPOs on international exchanges will start flowing again once market conditions improve.
But will they? Not, it seems, if the Russian authorities have anything to do with it.
On June 3, Russian business daily Kommersant released details of draft regulations that stand to have a profound impact on the ability of Russian companies to conduct share placements abroad.
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Russia-Focused Cross-Border M&A: Russian Companies Have Remained Acquisitive, But 2009 Outlook Is Bleaker
Posted on March 10th, 2009 Comments welcome Share/Save PrintBy Anna Gunning, Senior Account Manager, The PBN Company
Deteriorating market conditions in the second half of 2008 left many companies unable to raise capital and unwilling to undertake anything that could be perceived as a risky investment. However, accountancy firm KPMG’s latest Emerging Markets Acquisition Tracker shows that Russian companies have retained an appetite for cross-border M&A as companies from more developed markets have shied away.
Inward investment starts strong but falls off
In the first half of 2008 - when market commentators still spoke of “decoupling” - companies from developed markets continued to make acquisitions in Russia at a reasonable (albeit reduced) rate. Some of the high-profile deals included PepsiCo’s $1.4bn acquisition of juicemaker Lebedyansky and Barclay’s $745m acquisition of Expobank. With a total of 65 developed market acquisitions of Russian targets in H1 2008, there was a 35% year-on-year increase from the same period in 2007.
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Russia’s IPO Market: What the Experts Think
Posted on March 5th, 2009 Comments welcome Share/Save PrintPBN had an impressive array of investment bankers and capital markets experts at its launch today of IPO Pioneers 4, which was held at the Institute of Contemporary Development, a Moscow-based think tank. Here are some of their predictions and insights about capital market activities in Russia, Ukraine and the CIS: Read more »
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IPO Pioneers: 9 in 10 listed Russian & CIS companies worth less today than at IPO
Posted on March 5th, 2009 Comments welcome Share/Save PrintFollowing a disastrous year for the capital markets, only 8 of 92 companies from Russia and the CIS finished the year with a higher market capitalization than at their time of listing.
Vimpelcom, the first ever IPO from the region, has created and retained the most value since its NYSE listing in 1996 - up 1,066%. The other 7 companies with an increase in market capitalization were Open Investments at 456%, Mobile TeleSystems at 407%, Lebedyansky at 93%, Wimm-Bill-Dann at 40%, Pyaterochka (X5 Retail) at 17%, Novorossiysk Commercial Sea Port at 14%, and Novatek at 6%.
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