Ros Agro Plans First Russian Share Sale in London Since October

  • Company will offer $250 million shares to fund investments
  • Controlling shareholder Moshkovich to buy up to $100 million

Ros Agro Plc, Russia’s largest publicly traded farm company, plans to sell $250 million shares in London in the first Russian stock offering in the U.K. since October.

The sale of global depository receipts, representing newly issued ordinary shares, will support the company’s growth, Ros Agro said in a statement on Thursday. Controlling shareholder Vadim Moshkovich will purchase up to $100 million of GDRs and Chief Executive Officer Maxim Basov plans to buy some as well.

It would be the first share sale in London by a Russian company since Lenta Ltd., a Russian retailer backed by U.S. buyout firm TPG Capital, raised money in October.

Several Russian companies, including the country’s largest oil driller Eurasia Drilling Co. Ltd. and potash producer Uralkali PJSC, have withdrawn their listing in London as investor appetite for raw-material and emerging-market stocks declined.

Agriculture Profits

Russian agriculture is one of the few commodities industries that’s experiencing growth. The low cost of land, weaker ruble and food-import ban, imposed by the government in response to European and U.S. sanctions, helped boost profits for agricultural companies.

Ros Agro shares have more than doubled in price over the past year and reached a record $18 per GDR last month.

“Ros Agro is likely to sell GDRs around the current price level at about $16 to 17," Vladimir Vedeneev, chief investment officer of Raiffeisen Asset Management in Moscow, said by e-mail. “There will be demand. This is a trendy stock."

The proceeds from the share offering will support the company’s expansion, including a 60 billion ruble ($917 million) investment in pig farms in eastern Russia. Ros Agro is planning to spend up to 25 billion rubles on greenhouses in central Russia. The issue may also finance potential future purchases of land and facilities.

JPMorgan Chase & Co., UBS AG and VTB Capital are joint global coordinators and book runners of the deal.