Ukraine's Rise 'to seek' IPO on foreign market

Agrimoney.com | 8 April 2010

CJSC Rise may join the ranks of Ukrainian agricultural groups with a listing on a foreign stockmarket, through a flotation which could value it at $500m, including debt.

The crop trading-to-farm supplies giant is in talks with underwriters over a flotation by the end of the year, according to local reports.

The value of the group's equity has been estimated by Kiev-based investment bank Phoenix Capital at $200-250m, with Rise holding a further $230m-250m in debt.

Conglomerate discount?

However, the level of the valuation will depend on Rise's ability to convince investors that it is an integrated group, so should be spared the valuation discount that markets often apply to conglomerates.

"Rise is represented in separate sectors, and this is not welcomed by foreign investors," Phoenix Capital said, in comments reported by crop consultancy UkrAgroConsult.

The reports come days after Avangard, Ukraine's biggest egg producer, unveiled plans for a London flotation set to raise a reported $200m.

Other Ukraine groups with foreign listings include MHP, the grain and meat group also listed in London. Kernel, the sunflower oil and elevator company, is listed in Warsaw.

Capacity expansion

Money from Rise's flotation would go towards meeting an estimated $90m bill for plans to increase elevator capacity, both at ports and inland, and expand the group's land bank to 200,000 hectares.

The group is reported to have plans to expand its grain handling capacity sufficient to hit shipments of 2m tonnes a year from Black Sea facilities, compared with 650,000 tonnes in 2008-09.

Who's involved?

Who's involved?


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