Avangard to raise USD 187.5 mln in London IPO

Avangardco Investments (AIM: AVGR LN) expects to raise USD 187.5 mln in an initial public offering of shares in London, according to details announced this morning. Avangard set the offer price for its GDRs at $15 each, implying a market capitalization at placement of USD 937.5 mln (10 GDRs = one ordinary share). The offering represents 20% of the company’s share capital post-offering. Conditional dealings are due to commence today, April 30 on the London Stock Exchange with unconditional dealings starting on May 6. Avangard said it plans to use IPO proceeds to finance expansion and diversify its egg business via capital expenditures.  Avangard is the #1 producer of shell eggs and egg products in Ukraine. In 2009, Avangard posted revenue of USD 319.9 mln and EBITDA of USD 152.1 mln. Ruslan Patlavskyy:  We reiterate our view on the successful placement of Avangard’s shares as USD15/GDR price suggests attractive 2009 EV/EBITDA of 6.8x. This implies a 21% discount to publicly traded Ukrainian agricultural stocks’ median for 2009 EV/EBITDA as well as a 16% discount to MHP, Avangard’s best domestic proxy, given its market share and level of vertical integration.