OAO MegaFon, Russia’s second-largest mobile-phone operator, may start an initial public offering in London as early as next week, people familiar with the plans said.
The company, controlled by Russia’s richest man, Alisher Usmanov, and partially owned by Sweden’s TeliaSonera AB (TLSN), may announce an intention to float shares in the middle of next week after consultations between the shareholders and banks, said the people, who asked not to be identified as the talks are private. The possible IPO size could be $3 billion, the people said.
“MegaFon could be more attractive than OAO Mobile TeleSystems (MBT) and VimpelCom Ltd. (VIP), as it leads in the promising mobile data segment and has the most clear geographic focus among the Big 3 operators, with less than 1 percent of its revenues generated outside of Russia,” Konstantin Chernyshev, analyst of UralSib Financial Corp. said in a note last month.
Russian companies are returning to stock offerings after the central bank sold a $5.2 billion stake in Sberbank last month. MD Medical Group Investments Plc, Russia’s largest chain of maternity centers, and the billionaire Ananiev brothers’ OAO Promsvyazbank said this week that they are seeking to raise as much as $343 million and $414 million respectively in London share sales.
A MegaFon official declined to comment.
MegaFon may offer investors as much as 20 percent of its shares, including 10.6 percent from TeliaSonera’s stake and 9.4 percent held by a MegaFon unit, according to a shareholder agreement reached in April when Russian billionaire Mikhail Fridman’s Altimo cashed out of MegaFon.
Altimo then sold its 25 percent stake in MegaFon for almost $4 billion in cash, valuing the company at $15.9 billion, according to data compiled by Bloomberg and based on TeliaSonera’s statement. The company also paid $5.2 billion in dividends in April as part of Fridman’s exit and Usmanov gaining control of the operator.
MegaFon hired Morgan Stanley (MS), Goldman Sachs Group Inc. (GS), Credit Suisse Group AG (CSGN), Citigroup Inc. (C) and Russia’s Sberbank and VTB Capital to manage the sale, people familiar with the matter said in June.
Initial share sales in Europe, the Middle East and Africa have raised $6 billion this year, compared with $37 billion in the same period last year, data compiled by Bloomberg show.
Deutsche Bank AG, which along with Berenberg Bank led the $602 million IPO of German insurer Talanx AG last month, is ranked first in managing 2012 sales, according to the data. Earlier this week, Telefonica SA (TEF), Spain’s biggest phone company, said that it plans to sell shares in its German business this quarter to help reduce a debt pile of more than 58 billion euros.