We have advised Joint-Stock Commercial Bank Probusinessbank OJSC, one of Russia's fastest-growing financial institutions, on the private placement of 34.5 % of its shares with international investors. The deal signed on 1 November 2006 and completed on 24 November 2006.
Detail:
The transaction is one of the first of its kind in Russia and takes advantage of a relaxation in the regulatory regime of the Central Bank of Russia (the "CBR"), which simplified the direct participation of foreign companies in the share capital of Russian banks. The shares in Probusinessbank are being sold to Merrill Lynch and Renaissance Capital as placement agents for onward sale to a number of Russian and international investors. Merrill Lynch and Renaissance Capital were advised by Skadden Arps, Slate, Meagher and Flom LLP.
The cross-border team was led by corporate finance partner Oxana Balayan in Moscow, assisted by associates Michael Pugh in London, Konstantin Volk and Natalia Zaichenko in Moscow and with support from London partners Richard Brown, Andrew Carey and Katherine Mulhern, and Moscow partner Suren Gortsunyan.
Comment:
This transaction is significant as it is one of the first of its kind in the Russian market. Acting on this deal puts Lovells at the forefront of equity placements for Russian banks and since starting work on this deal Lovells has been involved in other placements of shares in Russian banks. In particular, Lovells represented Standard Bank and the major Russian investment bank, Troika Dialog, as arrangers on the US$81 million private placement of a top 25 Russian bank, Sibacadembank, and also Vozrozhdenie Bank, a top 25 Russian bank, on the US$54 million placement of its shares. The Probusinessbank deal is significant for Lovells as it shows Lovells debt capital markets clients broadening their mandate to Lovells by involving the firm in equity capital markets work and this is a very exciting development for Lovells equity practice, particularly as Probusinessbank has stated its intention to do an IPO in around 2 years.