Russia industry: Sistema-Hals plans to float 25% of shares in IPO

Sistema-Hals, the property development arm of AFK Sistema, one of Russia’s largest diversified companies, has received approval from state regulators to float 25% of its shares in an initial public offering (IPO) on the London Stock Exchange and Moscow’s RTS exchange.

Sistema-Hals, the property development arm of AFK Sistema, one of Russia’s largest diversified companies, has received approval from state regulators to float 25% of its shares in an initial public offering (IPO) on the London Stock Exchange and Moscow’s RTS exchange. Alexander Goncharuk, AFK Sistema’s president, said earlier that the company planned to float around 18% of Sistema-Hals’ shares on the London bourse in November. The company expects that after the stock float, Sistema-Hals’ market capitalisation will be in excess of $2bn.

Sistema-Hals focuses primarily on the Moscow area and is a leading developer of offices and luxury housing. Among its office developments the company built the Russian headquarters for automotive major Daimler-Chrysler (Germany), which won several international awards.

AFK Sistema is the largest consumer services private-sector company in Russia and the CIS, with over 50m customers. The company develops and manages businesses in fast-growing service-based industries, including telecommunications, technology, banking, real estate, retail and media. In September the company signed an agreement to acquire an 81.25% stake in Perm Motors, one of the country’s largest producers of jet aircraft engines and industrial turbines, from a subsidiary of state-owned Vneshtorgbank.