Kraft's shock bid triggers Unilever focus on short-term value
Kraft Heinz's bid has jolted Unilever into focusing more on delivering on its strategy in the short-term, the Anglo-Dutch company's finance chief said on Friday.
MOSCOW Books on the international stock market float of MegaFon MGFON.UL, Russia's second-largest mobile phone firm, were covered on Monday a day ahead of time, helped by a large order from a global investment fund, sources said.
"The book is oversubscribed," said one source close to the deal, adding that the initial public offering appeared likely to be finally priced in the lower half of the range.
MegaFon, controlled by Russia's richest man, Alisher Usmanov, is selling global depositary receipts in London and Moscow at $20-$25, potentially raising $1.7 billion to $2.3 billion and valuing the business at $11.2 billion to $14.0 billion.
The listing would establish MegaFon as an alternative to New York-listed Russia market players MTS (MBT.N) and VimpelCom Ltd VIP.N, as it seeks to lure investors with a pledge to pay a chunky dividend yield of 7-8 percent.
Questions about corporate governance, however, prompted investment bank Goldman Sachs (GS.N) to drop out of the deal while the UK Listing Authority signed off on the issue prospectus only after Usmanov pledged to keep overall control under a deal to restructure his and his partners' assets.
The bookbuilding process, in which MegaFon and its bankers pitched to investors in New York, London, Moscow and elsewhere to drum up orders, was also slowed down by the U.S. Thanksgiving holiday last week.
Bankers sought to play down concerns the deal could still go off track: "There's no reason to get freaked out," another said.
The deal received a boost after a large global investment fund placed an order for around $280 million worth of MegaFon stock, or more than a tenth of the issue, three sources said on Monday.
One called the quality of the order book "strong", with interest from long-only investors greater than from hedge funds, and buying interest better than when state-controlled Sberbank (SBER.MM), Russia's top bank, recently sold $5 billion in stock.
"I see a reasonable after-market," the source said. If syndicate banks exercise an over-allotment option, MegaFon would have a fairly small free float of 17 percent, making it a more natural target for long-term investors than short-term traders.
Nordic telecoms group Teliasonera is selling down its 35.6 percent stake and MegaFon itself is selling treasury stock it bought in an ownership restructuring last spring under which Usmanov secured bare majority control.
MegaFon is expected to finalize the placement on Tuesday night, with pricing, allocations and trading to begin on Wednesday.
Morgan Stanley (MS.N) and Sberbank are acting as joint coordinators, with Citigroup Inc (C.N), Credit Suisse CSGN.VX and VTB (VTBR.MM) as joint bookrunners.
(Reporting by Katya Golubkova, Olga Popova, Kylie MacLellan and Arno Schuetze; writing by Douglas Busvine; editing by Dan Lalor and Matthew Lewis)
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