Russian low-priced retailer Fix Price has said it is considering an initial public offering (IPO) in London and Moscow of its global depositary receipts (GDRs) to capitalise on strong growth boosted by demand for inexpensive goods.
Fix Price, which sells goods in walk-in shops and online at fixed prices, has grown in popularity as the COVID-19 pandemic has reduced many Russians' spending power.
It generated revenue of more than 190 billion roubles (€2.14 billion) in 2020, along with double-digit EBITDA margins and has posted 16 consecutive quarters of double-digit like-for-like sales growth, CEO Dmitry Kirsanov said in a statement.
"With a presence in 78 of Russia's 85 regions, as well as neighbouring countries, and a strong track record of results in our home market, Fix Price is well positioned to pursue expansion both inside and outside of Russia," Kirsanov said.
Fix Price said BofA Securities, Citigroup, J.P. Morgan, Morgan Stanley and VTB Capital had been engaged to act as joint global coordinators and bookrunners should the deal go ahead.
Financial market sources last month told Reuters the company might raise nearly $1 billion, mirroring Ozon, one of Russia's top online retailers which has capitalised on booming online sales amid the pandemic by listing its shares last November.
Fix Price said the offer would consist of GDRs from certain existing shareholders, as well as some members of senior management.
The GDRs would be admitted to trading on the main market for listed securities of the London Stock Exchange, with a secondary listing on Moscow Exchange, it added, subject to market conditions.
Citing an independent industry consultant report, market leader Fix Price said Russia's variety value retail market was expected to triple in size by 2027.
Fix Price reported adjusted EBITDA of 36.8 billion roubles and net income of 17.6 billion roubles for 2020.