Pharmstandard Postpones IPO
Pharmstandard has decided to postpone its initial public offering at least until the beginning of next year. A source close to the IPO's organizers says that an acquisition deal will be carried out to increase the company's capitalization. Potential buyers suspect that the cause is accounting irregularities that arose in the company's haste to hold its IPO.
Pharmstandard cancelled a meeting set for Friday with managers of USB investment bank related to the IPO. USB and Citigroup are the organizers of the IPO. Pharmstandard deputy general director Olga Leshchinskaya declined to comment on the IPO, which was to take place this year on three exchanges, the London Stock Exchange and the Russian MICEX and RTS exchanges, simultaneously. A source at one of the organizer banks said that Pharmstandard was planning to place 30-40 percent of its stock. Citigroup estimated the value of Pharmstandard at $1.5-2.1 billion, although other analysts have suggested lesser figures.
The company is the largest pharmaceuticals-producing holding in Russia. Its proceeds in 2005 were $201 million, EBITDA $61 million and net profit $32 million. This year, Pharmstandard planned to increase its turnover to $302 million, EBITDA to $123 million and net profit to $75 million. The company's chairman of the board Viktor Kharitonov owns 49 percent of the company's stock, company executive Egor Kulkov owns 21 percent, Roman Abramovich owns 17 percent, Evgeny Shvidler owns 6 percent and Millhouse Management owns 7 percent.
A Kommersant source stated that the delay was caused by a pending acquisition. Pharmstandard has already acquired the Russian company Masterlek this autumn for the purposes of increasing its own worth. A source has told Kommersant that Pharmstandard affiliate Pharm-Terra acquired 49 percent of the Omsk Lekarstvo chain from the administration of Omsk Region last month. Observers suspect the possible presence of accounting problems, which, if uncorrected, could lead to the cancellation of the IPO altogether.
Olga Kocheva, Dmitry Kryazhev
All the Article in Russian as of Nov. 08, 2006
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Photo: Dmitry Lebedev
