Protek prices share offering at USD 3.50 per ordinary share
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Please read the following notice carefully before deciding whether to click on the link below to access information relating to OAO “Protek”, an open joint stock company organized in the Russian Federation (the "Company"), in advance of the anticipated offering by certain of the Company’s shareholder(s) of the Company's ordinary shares (the "Shares") in the Russian Federation, in certain jurisdictions outside the Russian Federation under circumstances not constituting an offer to the public in such jurisdictions and outside the United States in reliance on Regulation S under the Securities Act of 1933, as amended (the "Securities Act"). The Company does not accept any responsibility for any contravention of applicable securities laws and regulations by individuals as a result of false information provided by such individuals.
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Open Joint Stock Company Protek (“Protek” or the “Company”), one of the largest vertically integrated pharmaceutical companies in Russia, today announces the price of its international offering (the “Offering”) of its ordinary shares (the “Ordinary Shares”).
The Company, which operates in three principal business segments of the Russian pharmaceutical market, namely distribution, retail and production, has been listed in the “V” list and admitted to trading on the Russian Trading System (“RTS”) and admitted to trading without listing on the Moscow Interbank Currency Exchange (the “MICEX”).
Summary of the Offering
- The Offering has been priced at USD 3.50 per Ordinary Share;
- A total of 114,285,714 Ordinary Shares are being sold, held by Tantarra Holdings Limited (“Tantarra”) and Streitum Investments Limited, companies organized under the laws of Cyprus (together, the “Selling Shareholders”);
- The gross proceeds of the Offering are approximately USD 400 million;
- The proceeds the Company expects to receive pursuant to the subsequent placement of newly issued Ordinary Shares to Tantarra through the closed subscription (the “Closed Subscription”) are approximately USD 188 million net of underwriting commissions, taxes, fees and expenses payable in connection with the Offering;
- The implied market capitalization of the Company upon completion of the Offering and assuming completion of the Closed Subscription as described above is approximately USD 1,845 million;
- The post-money free float following the Offering and the subsequent placement of Ordinary Shares to Tantarra through the Closed Subscription is expected to be approximately 20.2%;
- The Ordinary Shares have been listed in the “V” list and admitted to trading on RTS and admitted to trading without listing on MICEX, in each case under the symbol “PRTK”, and will begin trading on each exchange as of 27th April 2010; and
- Renaissance Capital and UBS Investment Bank acted as Joint Global Co-ordinators and Joint Bookrunners for the Offering.
Protek intends to use the net proceeds from the Closed Subscription primarily to finance the growth of its retail business and further develop its production operations by expanding its research and development platform and extending its brand portfolio. Part of the proceeds will also be used within the distribution segment to modernize selected warehouses and for general corporate purposes.
This use of proceeds will support Protek’s strategy, which is focused on the growth of its market share in its three key business segments, while strengthening the integration of its operations and leveraging synergies between them.
Commenting on today’s announcement, Vadim Muzyaev, President of Protek said:
“The successful completion of our IPO is a major milestone in the development of Protek and we are confident that as a public company we can continue to build on our track record of achievements across the Russian pharmaceutical sector. We are very happy with the response to the Offering and, as one of the first listings in this sector for some time, we believe that today’s announcement demonstrates investors’ belief in our broad based business strategy. We believe that our vertically integrated business, which benefits from involvement in the principal segments of this market, will allow us to generate revenue growth and capitalize on the multiple opportunities for synergies that exist across the Company. Protek is focused on creating attractive value growth for our new shareholders and on playing an important role in the development of the pharmaceutical market in Russia.”
Enquiries:
Protek
Polina Belyaeva
Head of Public Relations OJSC Protek
Tel: +7 (495) 737-35-00 Ext. 3455
Mob: +7(903) 753-51-78
e-mail: p_belyaeva@protek.ru
Citigate Dewe Rogerson (for international media)
David Dible/ Chris Gardner/Amber Bielecka
Tel: +44 (0)20 7638 9571
Mob: +44 (0) 07967 566919 / +44 (0) 7903 737 649 / +44 (0) 7984 141 186
e-mail: firstname.lastname@citigatedr.co.uk
Infomost Communications (for Russian Media)
Dmitry Manakov
Tel: +7 495 933-5222 Ext. 12
Mob.: +7 903 797-7553
e-mail: dmanakov@infomost-com.ru
Oksana Ionova
Òål: +7 495 933-5222 Ext. 17
Mob.: +7 964 500-2530
e-mail: ionova@infomost-com.ru
Notes to Editors
Protek
Protek is one of the largest vertically integrated pharmaceutical companies in Russia (by sales in 2009). For the years ended December 31, 2009, 2008 and 2007, the Company’s consolidated sales were RUR 91,581 million, RUR 77,514 million and RUR 63,265 million, respectively, after inter-segmental eliminations. The Company’s consolidated EBITDA was RUR 5,837 million in 2009, RUR 3,478 million in 2008 and RUR 2,124 million in 2007, after inter-segmental eliminations.
Protek operates in three principal business segments:
Distribution. Protek is the largest wholesale pharmaceutical distributor in Russia with a market share of 22.2% in 2009 (according to DSM Group (“DSM”)). Protek distributes a broad range of pharmaceuticals and parapharmaceuticals (health and beauty products) in Russia sourced from leading international pharmaceutical companies, Russian domestic pharmaceutical manufacturers, Protek’s own production segment and other third parties. This broad range of products is then distributed to Protek’s own retail business, including the Rigla pharmacy chain, large private and state-owned pharmacy chains and independent pharmacies, national and local wholesalers, hospitals, medical centers and primary care clinics throughout Russia.
Retail. Protek operates one of the leading pharmaceutical retail businesses in Russia including its flagship pharmacy chain, Rigla. According to DSM, Protek’s retail business is the second largest in Russia by revenue with a market share of 2.8% in 2009.
Production. Protek’s production segment comprises four companies, including CJSC PharmFirma Sotex, one of the Top 5 domestic pharmaceuticals manufacturers in Russia in terms of sales in 2009, according to Pharmexpert.
Protek’s leading market position and broad geographic coverage across Russia allows the Company to capitalize on growth in the market through greater economies of scale, providing value added services and leveraging its relationships with suppliers and customers. Its vertically integrated business model provides opportunities for synergies between the business segments and shared knowledge allows the Company to react quickly to market trends and pricing pressures. These competitive strengths are underpinned by an excellent operational and technological platform, including one of the most modern, efficient and technologically advanced warehousing and logistics infrastructures in Europe; a focus on quality of service; a highly experienced management team; and a strong corporate and brand reputation.
The Russian Pharmaceutical Market
According to IMS, the compound annual growth rate of the Russian pharmaceutical market in US Dollar terms is forecast to be 13% between 2008 to 2013 (IMS, 2009). Further research from DSM indicates that the Russian pharmaceutical market grew from RUR 365 billion in 2007 to RUR 538 billion in 2009. DSM forecasts growth of the Russian pharmaceutical market for 2010 at 11% in 2010 in Rouble terms (to RUR 596 billion).
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Neither this announcement nor any copy of it may be taken or transmitted, directly or indirectly, into the United States, Canada or Japan. This announcement does not constitute a prospectus or form part of any offer or invitation to sell, or any solicitation of any offer to purchase nor shall it (or any part of it) or the fact of its distribution, form the basis of, or be relied on in connection with, or act as any inducement to enter into, any contract or commitment therefore. Nor does this announcement constitute a recommendation concerning the Offering. Potential investors should consult a professional advisor as to the suitability of the Offering for the individual concerned. Recipients of this announcement who intend to purchase or subscribe for Ordinary Shares in the Company are hereby reminded that any such purchase or subscription must be made solely on the basis of the information contained in the offering memorandum relating to the Company in its final form to be published in due course.
No offer of shares is being made in the United States and the information contained herein does not constitute an offering of securities for sale in the United States, Canada or Japan. No money, securities or other consideration is being solicited and, if sent in response to the information contained herein, will not be accepted. The offer and distribution of this announcement and other information in connection with the proposed listing and Offering in certain jurisdictions may be restricted by law and persons into whose possession any document or other information referred to herein comes should inform themselves about and observe any such restriction. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction.
The shares mentioned herein have not been, and will not be, registered under the US Securities Act of 1933, as amended (the "Securities Act"), and may not be offered or sold in the United States or to or for the account or benefit of US persons (as such term is defined in Regulation S under the Securities Act) absent registration or an exemption from registration.
Any offer of securities to the public that may be deemed to be made pursuant to this announcement in any EEA Member State that has implemented EU Directive 2003/71/EC (together with any applicable implementing measures in any Member State, the "Prospectus Directive") is addressed solely to qualified investors (within the meaning of Article 2.1(e) of the Prospectus Directive) in that Member State.
This announcement and the information contained herein are only being distributed to and are only directed at (i) persons who are outside the United Kingdom or (ii) persons who have professional experience in matters relating to investments falling within the definition of "investment professionals" in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the "Order"), or (iii) high net worth entities, and other persons to whom it may lawfully be communicated, falling within Article 49(2) of the Order (all such persons together being referred to as "relevant persons"). Any investment or investment activity to which this announcement and the information contained herein relate will only be available to and will only be engaged with relevant persons. Any person who is not a relevant person should not act or rely on this announcement or any of its contents.
This announcement and the information contained herein are not a public offer or advertisement of securities in the Russian Federation, and are not an offer, or an invitation to make offers, to purchase, sell, exchange or transfer any securities in the Russian Federation.
Some of the information in this announcement and the information contained herein may contain projections or other forward-looking statements regarding future events or the future financial performance of the Company. You can identify forward-looking statements by terms such as "expect," "believe," "anticipate," "estimate," "intend," "will," "could," "may" or "might", the negative of such terms or other similar expressions. These statements are only predictions and actual events or results may differ materially. We do not intend to update these statements to reflect events and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events. Many factors could cause our actual results to differ materially from those contained in our projections or forward-looking statements, including, among others, general economic conditions, our competitive environment, as well as many other risks specifically related to the Company and its operations.
Renaissance Securities (Cyprus) Limited and UBS Limited are acting exclusively for the Company and the Selling Shareholders and no one else in connection with the Offering. They will not regard any other person (whether or not a recipient of this announcement) as their respective clients and will not be responsible to anyone other than the Company or the Selling Shareholders for providing the protections afforded to their respective clients nor for giving advice in relation to the Offering, the contents of this announcement or any transaction or arrangement referred to herein.
