Renaissance Insurance Group announced on Monday that it plans to list its shares on the Moscow Stock Exchange and raise up to $ 290 million in an initial public offering (IPO), riding the wave of IPOs on the stock exchange in Russia.
Russia’s IPO activity, hit by the COVID-19 pandemic last year, is accelerating as the economy improves and concerns about new Western sanctions fade. The Moscow Stock Exchange plans to hold 10 stock quotes by the end of the year.
Renaissance Insurance plans to raise up to 21 billion rubles ($ 289 million) in an IPO that would make it the first listed insurance company in Russia, she said in a statement. ‘intention to float.
Other Russian companies, including real estate database CIAN, carsharing company Delimobil, IT company Softline, food retailer Vkusvill and the St. Petersburg Stock Exchange are also preparing IPOs, sources said.
Russian companies are bullish, a Russian investment banker said, although some funds are signaling the risk of a downward correction in stock prices as the US and Russian stock indexes approach their all-time highs.
Renaissance Insurance, one of Russia’s 10 largest insurers, said it is also planning a secondary offering of existing ordinary shares by certain shareholders.
The company intends to pay out at least 50% of consolidated net profit in the form of dividends, he said, after posting an almost 15% increase in net profit to 4.7 billion rubles in 2020.
The statement confirmed a previous Reuters report that Renaissance Insurance, founded in 1997 and headed by Boris Jordan, was considering registering in Moscow this fall.
Proceeds from the IPO will be used to accelerate organic growth, investments in digital initiatives, potential acquisitions and eventual buyback of listed shares, the company said.
Renaissance Insurance says it relies heavily on digital technologies, such as artificial intelligence (AI), which should help expand its presence in Russia.
The company has not provided the exact timing of the IPO or given details of possible acquisition targets.
The IPO also marks a milestone for online bank Tinkoff, which will act as the IPO organizer for the first time as part of its efforts to grow its business in the equity capital markets.
Other joint bookkeepers include BCS Global Markets, Renaissance Capital and Sberbank, while Credit Suisse, JP Morgan and VTB Capital also act as joint global coordinators.
($ 1 = 72.5975 rubles)
(Reporting by Andrey Ostroukh, additional reporting by Olga Popova, Katya Golubkova, Alexander Marrow and Maxim Rodionov; edited by Louise Heavens and Mark Potter)
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