Venue (#09 September 2010)

Ukrainian IPO 2011: Pending New Billion

Yulia V. Afanasieva

Ukrainian companies and companies from the CIS will be among the most attractive IPO investment targets on the Alternative Investment Market of the London Stock Exchange (AIM) in the coming year, participants of the Ukrainian IPO 2011: pending new billion round table, concluded. It was organised by INTEGRITES international law firm and the London Stock Exchange in partnership with Rothschild Investment Bank and held on 14 July in Kiev.

Due to the regeneration of world markets, the attractiveness of domestic fast-growing assets for the world's stock exchanges will increase in coming months, Andrei Liakhov, partner of INTEGRITES pointed out. Mr. Liakhov stated that by the end of the year medium-sized Ukrainian companies as well as representatives of large business will place their shares via an IPO.

Those present actively discussed the prospects of post-crisis placement of domestic enterprises. At present about 6 Ukrainian companies are planning to hold an IPO in the autumn of this year.

Jon Edwards, senior manager of the London Stock Exchange Department for CIS countries and Central and Eastern Europe, sees positive points for the successful placement of Ukrainian companies in a low cost offering and loyal demands to the issuer to enter the Stock Exchange. Companies from the CIS have a chance of raising funds double the size of companies from other countries as they initially possess high potential for further growth.

Mr. Liakhov paid special attention to the fact that it is not obligatory for a company which is going to make an IPO to have more than USD 50 million. There are a lot of examples of successful placement when companies have a capitalization of no more than GBP 2.4 million.

According to Aleksandr Pochkun, managing partner of accounting firm Baker Tilly Ukraine, not all Ukrainian companies are ready to enter the Stock Exchange because of the inadequate preparation of their financial statements, a fact that may become a major issue for companies looking to float.

Sebastian Oechelhaeuser, managing director of Rothschild Investment Bank (London), added that the key factors when deciding whether to invest in Ukraine remains the situation on the Russian market.

At the end of the meeting all the attendees came to the conclusion that with the proper legislative support on stock market development and stabilization of the political situation in Ukraine in 2011 the volume of placements by Ukrainian companies may exceed pre-crisis activities.

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