February 14, 2011, 00:48 / Business

Centrobuv will conduct an initial public offering of shares

CJSC "Trading company Tsentrobuv"

Retail network. The owner (according to SPARK) is Latsia Consulting Ltd. (100%), beneficiaries are Anatoly Gurevich, Dmitry Svetlov, Sergey Lomakin, Artem Khachatryan. Financial indicators (RAS, 2009): revenue – 14.24 billion rubles, profit – 23.7 million rubles.

The largest Russian shoe retailer, Centrobuv, may enter the stock exchange. The company hired investment banks Renaissance Capital and Morgan Stanley to conduct an IPO on the LSE in the fall of 2011 - spring of 2012.

The Centrobuv retail chain has begun preparations for a public offering of its shares, employees of five investment banks and two retail companies told Vedomosti. The parameters of the IPO have not yet been determined, but the London Stock Exchange is considered a priority option for listing the retailer, said an employee of one of the Russian investment banks. The company expects to hold an IPO in the fall of 2011 or spring of 2012, according to a top manager of the retail chain, which is also studying the possibility of an IPO.

An employee of one of the Russian investment banks knows that the deal will be carried out by two Russian and two Western banks, one of the organizers is Renaissance Capital. Two sources in the financial market named Morgan Stanley among the organizers of the upcoming IPO. “There will be more than two organizers, but this issue has not yet been formalized,” says a source close to one of the IPO organizers. Representatives from Renaissance Capital and Morgan Stanley declined to comment.

The owners of Centrobuv expect that the company will be valued at more than $1.5 billion, an acquaintance of one of the co-owners of the chain told Vedomosti. An employee of one of the investment banks cites a figure of up to $3 billion. The company’s EBITDA, according to one of the sources, in 2010 was about $200 million, and according to the coefficients of 2011 and 2012, the company can easily count on a business valuation on the stock exchange of $3 billion.

It was not possible to contact the owners of Centrobuva. Co-owner of the network Sergei Lomakin confirmed to Reuters that the company is “exploring various options for attracting financing.” Former co-owner of the Kopeika chain, Lomakin, together with his partner Artem Khachatryan, acquired 33% of Tsentrobuv in March 2009 for approximately $40 million. At that time, the company operated approximately 300 stores.

Tsentrobuv is one of the most closed companies on the retail market: it does not publish revenue or even the exact number of stores, and it is difficult to judge the scale of its business, says Anton Titov, general director of the rival Obuv Rossii group. The Centrobuvi chain unites more than 500 stores, one of its employees told Vedomosti. The group's revenue at the end of 2010 significantly exceeded $500 million, Reuters writes, citing its sources. According to SPARK, in 2009, the revenue of ZAO Trading House Tsentrobuv (considered the operating company of the network) amounted to 14.2 billion rubles.

“Tsentrobuv” is the largest Russian shoe retailer and one of the largest in Europe, says leading consultant of Fashion Consulting Group Galina Kravchenko. The retailer, according to her, is developing the Centrobuv and Centro networks and operates in the mass market segment, that is, it sells inexpensive shoes and often updates its assortment. “During the crisis, this segment showed positive dynamics,” says the expert. Fashion Consulting Group estimates the volume of the Russian footwear market at $15 billion.