Russian Sovcomflot Eyes 17% IPO

The government will list between 15.5 and 17% of Russia's state shipping giant Sovcomflot (SCF) in an initial public offering (IPO) on the Moscow exchange next month, the company reported on September 28. SCF announced the IPO plan on September 15, and Russia's finance ministry said at the time that a 25% stake in the company would be sold. Sovereign wealth fund RDIF is also reportedly looking to invest in the shipowner.

The IPO price range is set at rubles 115-117/share, SCF said, which would value the overall company at rubles 250-270bn ($3.2-3.5bn). This means it is looking to raise between rubles 39bn and 46bn ($490-580mn) from the offering. Pricing is expected to take place on October 7.

The 100% state-owned company, which earned $823mn in core earnings (Ebitda) last year, owns nearly 150 tankers, dry cargo ships and other vessels, including 15 LNG carriers. Its IPO was first proposed nearly two decades ago, and there have been on-and-off talks about the company's partial privatisation ever since.

Russia's financial markets have weakened amid fears of a coronavirus resurgence weighing down on oil prices and international tensions over the poisoning of Russian anti-corruption activist Alexei Navalny. The ruble reached a six-month low of over 79 against the US dollar on September 29.