Russian Helicopters was valued at as much as $2.38 billion before an initial public offering in London as the company seeks funds to pay off debt and buy shares in its units.
The division of state-owned defense industry holding company Oboronprom is seeking $19 to $25 per Global Depositary Receipt, valuing it at $1.81 billion to $2.38 billion, according to a statement Tuesday. Russian Helicopters aims to raise at least $500 million in the sale, including for "mandatory tender offers" for shares in its subsidiaries.
The share offering consists of new shares worth $250 million as well as Oboronprom's existing stock. The shares will be listed on the MICEX and RTS exchanges, while the GDRs will trade on the London Stock Exchange.
The value of Spectrum's initial investment in Moscow-listed Kazan and Ulan-Ude has surged 200 percent over the past two years, said Michael Kart, a managing director at Moscow-based investment company Spectrum Partners, which has invested in the company's Kazan Helicopters and Ulan-Ude units.
Bank of America Merrill Lynch, BNP Paribas and VTB Capital have been hired to organize the sale.
The offer price for the IPO may be announced on or around May 11, according to the statement. Unconditional dealings in the GDRs are expected to commence around May 16.