Bruce Barnard | Oct 13, 2010 10:53AM EDT
Russia's largest rail container operator, TransContainer, plans to raise up to $525 million from an initial public offering on the London Stock Exchange before the end of the year.
TransContainer, a subsidiary of state-owned Russian Railways, intends to float a 35 percent minus two shares stake.
The company, which operates 46 container depots across Russia and is active in logistics, has a target valuation of between $1.2 billion and $1.5 billion.
TransContainer was due to pre-market the stock Oct. 13 and is expected to set a price on Nov. 10.
TransContainer, which had revenue of $537 million and net income of $19 million in 2009, is planning to move into rail container and logistics markets in East Europe and the former Soviet republics.
Russian Railways owns 84.9 percent of TransContainer and plans to retain a majority stake in the company.
The London-based European Bank for Reconstruction and Development has a 9.2 percent stake with the remainder held by Russian and foreign investment funds.
Russian Railways, which is seeking to raise billions of dollars to modernize its infrastructure and rolling stock, plans an initial public offering for another subsidiary, Freight One, but has not set a date or a location for the listing.
Rail accounts for around 40 percent of Russia's total freight market, rising to 85 percent if pipeline traffic is included.
Rail traffic slumped during the global financial crisis in 2008/9 but has started to recover with analysts forecasting annual growth of 10 percent though 2015.
Globaltrans, Russia's largest private rail freight operator, listed its shares in London in 2008.
Russia's largest port operator and stevedore, Novorossiysk Commercial Sea Port, is also quoted on the London Stock Exchange.
-- Contact Bruce Barnard at brucebarnard47@hotmail.com.
