Hyper speed

7 February 2014 By Quentin Webb

The St Petersburg hypermarket operator may raise $1 bln in a London IPO. It boasts high margins and lots of potential as Russian shopping goes Western. Yet equities are wobbly, the economy sluggish and consumers wary. Structural growth is a harder sell with such a weak backdrop.

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Lenta, the Russian hypermarket retailer, said on Feb. 3 it planned to sell shares in London. The company did not disclose the size of the offering but sources familiar with the matter have previously told Reuters the listing could raise at least $1 billion. A financial market source told Reuters that one of the bookrunners valued the company’s equity at $5.3 to $6.2 billion.

The initial public offering will consist of entirely existing shares. Lenta’s backers include U.S. private equity firm TPG, which owns 49.8 percent; the European Bank for Reconstruction and Development, with 21.5 percent; and VTB, the Russian bank, which owns 11.7 percent.

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