* Offering twice subscribed at low end of f/c range
* Shares trade at 55 roubles, in line with IPO price
* Share sale values bourse at $4.2 billion
By Maria Kiselyova and Alessandra Prentice
MOSCOW, Feb 15 Shares in the Moscow Exchange
made their market debut on Friday and traded at around
the offer price set in the company's flotation, marking a
subdued start to Moscow's latest attempt to establish itself as
a global financial hub.
The stock was changing hands at 55 roubles by 1241 GMT, bang
in line with the price of the company's initial public offering
which compared with a previously stated range of between 55 and
57 roubles, itself narrowed from an initial indicative range of
55 to 63 roubles.
The flotation of the exchange, Russia's main venue for
trading in stocks, bonds, currencies and derivatives,
raised 15 billion roubles ($500 million) after attracting demand
for twice the number of shares on offer at the
bottom-of-the-range price, boosted by support from a
state-backed investment fund.
The IPO, carried out on the exchange's own platform, was
politically and economically important in Russia after President
Vladimir Putin made it an example of the sort of
domestically-oriented share sale he wanted to encourage to boost
Moscow's financial status.
The flotation of 30 percent of the exchange's equity, which
valued it at 126.9 billion roubles, came as finance ministers
and central bankers from the Group of 20 countries were meeting
"We proved that international investors are ready to come to
Moscow if the asset is interesting," Moscow Exchange Chief
Executive Alexander Afanasiev told Reuters after the opening
bell rang out to signal the stock's debut.
Financial market sources told Reuters on Thursday the
flotation had attracted foreign investors including China's
sovereign wealth fund CIC, while Russia's state private equity
fund RDIF also helped to fill the order book.
RDIF said it invested $80 million, becoming a 4.5 percent
shareholder, and had attracted another $200 million to the
flotation from other unnamed investors.
Speaking in a glass-walled office with views of the golden
domes and Stalinist skyscrapers of Moscow's skyline, Afanasiev
said the flotation had succeeded in attracting credible
"Firstly, it is about the quality of the investor base, we
didn't want to lose some very good names that are currently our
shareholders. Secondly ... they are also our future customers,
the users of our market," he said.
The bourse will have a free float of around 30 percent.
"The listing of a stock exchange is always important for a
country in the development of their capital markets," said an
equity capital markets banker.
"There is obviously a wider goal to have more Russian
companies list on their exchange ... this will be part of that
and obviously helps show how it can be done by doing it
Credit Suisse, J.P. Morgan, Sberbank CIB and VTB Capital
were acting as joint global coordinators and joint bookrunners
of the offering. Deutsche Bank, Goldman Sachs, Morgan Stanley,
Renaissance Capital and UBS were joint bookrunners.
The groundwork for the IPO was laid by improvements to
Moscow's capital markets, such as the commissioning of a new
central securities depository in November to simplify trading
Afanasiev said further developments are in the pipeline to
persuade foreign investors of Moscow's global standing,
including plans to strengthen post-trading infrastructure and to
introduce a new trading regime and derivative products.
Yet the long-term aim of building Moscow's financial clout
may still rest on overcoming legal and corporate governance
concerns, exemplified by the 2009 death in a Moscow jail of
anti-corruption lawyer Sergei Magnitsky which has lately led to
a diplomatic standoff between Russia and the United States.