Pharmstandard seeks valuation up to $2.2 bln in IPO
Last Updated: 2007-04-23 10:00:17 -0400 (Reuters Health)
MOSCOW (Reuters) - Russian drugs maker Pharmstandard said on Monday it was seeking a valuation of between $1.75 billion and $2.20 billion at its upcoming London initial public offering (IPO), the first by a Russian pharmaceuticals company.
The company said investors were given an indicative price range of $11.55-$14.55 per Global Depositary Receipt (GDR) and $46.20-$58.20 per share.
The bookbuilding and international roadshow for investors starts on Monday, and final pricing should be set by May 4.
Citibank and UBS are joint global coordinators for the IPO and have an over-allotment option to purchase GDRs representing up to 15 percent of the total number on offer.
Pharmstandard, which has a small listing on Moscow's RTS exchange, plans to float a stake of up to 40 percent in London and Moscow.
The company says it was the fourth-largest drug company operating in Russia by sales volume last year. An independent researcher said it had grabbed the lead in the commercial sector of the market early this year.
Some analysts have found the company's mid-range valuation of around $2 billion ambitious. The absence of listed rivals also makes it hard to estimate how the market values the company.
The float follows Pharmstandard's acquisition last year of Masterlek and with it a product portfolio including antiviral drug Arbidol, the market leader in Russia ahead of Pfizer's Viagra anti-impotence treatment.
Russian commercial drug sales rose by 22 percent in 2006 to $5.2 billion, according to market researchers Pharmexpert, which said Pharmstandard had taken first place in the first two months of this year from Sanofi-Aventis.
The float would be of existing shares belonging to the company's owners -- Viktor Kharitonin, Yegor Kulkov and Millhouse Capital, the investment vehicle of Russia's richest man, Roman Abramovich, which owns a 31 percent stake.
The company said sales rose 50 percent to 8.52 billion roubles ($324 million) in 2006 while net profit gained 109 percent to 1.9 billion roubles ($72 million).
Only 8 percent of overall sales were tied to a government drugs reimbursement programme. The scheme, designed to replace Soviet-style provision for people on low incomes, has been hit by teething troubles and financial woes.
