Belarusian retailer Eurotorg has announced its intention to float on the London Stock Exchange, following the publication of a Registration Document today (4 October).
Following the publication, the group expects to announce its plans to float on the LSE on 11 October.
Eurotorg holds 19% of the retail market in Belarus, or approximately 41% of the modern retail market, making it five times the size of its nearest competitor.
In the first half of its financial year, the group posted a 14.9% increase in revenue, to BYN 2.18 billion, while like-for-like sales were up 5.9%, driven by an increase in LFL average ticket.
Modern Formats
Commenting on the group’s decision to float, Eurotorg CEO Andrei Zubkou said, “Eurotorg is the undisputed leader in the Belarusian grocery retail market, and a pioneer in the nationwide roll-out of modern retail formats and online grocery shopping.
“This announcement follows on from our successful debut Eurobond issuance in October 2017, when we effectively opened international capital markets for Belarussian corporate issuers.”
Describing Eurotorg as being at “an exciting point in its development”, he added that the company believes that “now is the time for Eurotorg’s exciting growth story to become better known among international investment audiences.”
The offering is expected to consist of Global Depositary Receipts (GDRs), representing interests in ordinary shares.
Eurotorg is expected to apply for listing and trading of the GDRs by way of admission to the standard segment of the Official List of the UK Financial Conduct Authority and trading on the London Stock Exchange.
Credit Suisse and J.P. Morgan are acting as Joint Global Coordinators. Bank of America Merrill Lynch, Renaissance Capital, Sova Capital, UBS and WOOD & Company are acting as Joint Bookrunners.
Belarusian Retail
The Belarusian grocery retail market was worth approximately BYN 22 billion in 2017. The penetration of modern retail formats in the country stands at just 46%, considerably below most other emerging markets and broadly corresponding, for example, to levels of modern retail penetration in Russia in 2007 and Poland in 2006.
“Modern format grocery retail has taken root in Belarus but retains plenty of potential for further growth, given current market penetration of 46% – similar to where Poland was more than a decade ago," Zubkou added. "We are also excited by the potential of the online grocery retail market, which is forecast to grow at 35% CAGR for the next five years and where we enjoy 98% market share."
© 2018 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: European Supermarket Magazine.
