OAO PhosAgro fell the most in two weeks, after reaching a record high, as its majority owners sell shares to help Europe’s largest phosphate-fertilizer producer expand its investor base.
PhosAgro closed down 4.6 percent at 1,316.90 rubles in Moscow, the steepest drop since March 26, and declined 4.2 percent to $14.15 in London. The amount of shares traded was 593,488, equivalent to about 1.7 times the three-month average.
A group of companies controlled by Andrey Guryev and his family is offering shares and global depositary receipts equivalent to about a 9 percent stake, according to a statement from PhosAgro late yesterday. They will reinvest about 45 percent of the proceeds in new stock issued by the Russian company, according to the statement. The shares have dropped 5.6 percent from a record high of 1,394.50 rubles on April 5.
“Pressure on the share price will probably remain in the short term,” Artem Egorenkov, an analyst at Moscow-based UralSib Capital, said in an e-mailed note today. “In the long term, the appeal of the shares will increase as the overhang risk eases and the free-float increases by about 150 percent.”
The offering may expand Phosagro’s free float to about 19 percent, opening the possibility of entry into the MSCI Inc. indexes and expanding its investor base, Denis Gabrielik, an analyst at Otkritie Capital in Moscow, said by e-mail. PhosAgro’s initial public offering in 2011 raised $565 million through the sale of a 10.7 percent stake in the producer.
The companies selling the stock -- Adorabella Ltd., Chlodwig Enterprises Ltd. and Miles Ahead Management Ltd. -- represent the interests of the Guryev family, according to a February Eurobond prospectus on the company’s website.