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MegaFon appoints banks for London IPO
04 May 2012
Russian operator MegaFon selects Goldman Sachs and Morgan Stanley to raise $4bn in share offering
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MegaFon
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share flotation
MegaFon has appointed Goldman Sachs and Morgan Stanley as joint global co-ordinators to raise up to $4 billion in a London initial public offering.
MegaFon is said to have met more than a dozen banks during the pitching process, and its decision made the losing banks strive to secure lower slots in the syndicate, reports the International Financing Review?.
Bankers at Goldman Sachs and Morgan Stanley declined to comment, while one banker told the IFR that more than two firms had been expected to secure top level roles.
Banks that pitched for the IPO included Bank of America Merrill Lynch, Barclays, Citigroup, Credit Suisse, Deutsche Bank, JP Morgan, Renaissance Capital, Sberbank, UBS and VTB, said the report. MegaFon is likely to select many other bookrunners in the next few days.
The IPO will see 20% of MegaFon floated from a mix of treasury and TeliaSonera-owned stock to raise between $3.5 billion and $4 billion.
MegaFon, which has just started rolling out 4G technology, earned net income of $1.48 billion on revenue of $8.24 billion in 2011.
The operator has received a credit line of up to $1.5 billion from Russia’s state-controlled Sberbank, and a $1 billion loan from state-owned Gazprombank, plus $2 billion in a syndicated loan from Western banks, to buy back local businessman Mikhail Fridman’s 25.1% stake in MegaFon from Altimo, as part of a complex restructuring critical to the IPO.
Russian businessman Alisher Usmanov will take control of the company by buying shares from Altimo and from TeliaSonera, which owns 43.8% of MegaFon. TeliaSonera said the listing will take place after the payment of a $5.15 billion dividend to shareholders. It will hold a stake of 25% plus one share in MegaFon after the IPO. GTB
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