Russian online retailer Ozon plans potential $500 million U.S. IPO

[November 03, 2020] By Olga Popova and Alexander Marrow

MOSCOW (Reuters) - Russian online retailer Ozon has filed for an initial public offering (IPO) in the United States, it said on Tuesday, which financial market sources said could raise at least $500 million for the company's expansion.

A view shows the pick-up point of the Ozon online retailer in Moscow, Russia March 16, 2020. REUTERS/Evgenia Novozhenina

The fast-growing company, which sells everything from white goods to children's clothes and has benefited from the boom in e-commerce during the COVID-19 pandemic, has been considering an IPO for some time.

Ozon intends to list its American depositary shares (ADSs) on the Nasdaq Global Select Market. No pricing terms were disclosed but United States-based IPO research firm Renaissance Capital and two financial market sources estimated that Ozon could raise at least $500 million.

The company indicated a maximum size of $100 million for the proposed offering, a figure estimated solely for the purposes of calculating the registration fee, according to the prospectus submitted to the U.S. Securities and Exchange Commission (SEC).

Shares in Ozon's leading shareholder, Russian conglomerate Sistema, rose more than 3% in early trade before paring gains. Sistema said it had noted Ozon's announcement.

The company said it did not expect to pay dividends in the foreseeable future, with all available funds earmarked for growth.

"We intend to retain all available liquidity sources and future earnings, if any, to fund the development and expansion of our business," said Ozon, which also counts private equity group Baring Vostok among its biggest shareholders.

In financial results disclosed in the prospectus, Ozon said revenue for the first nine months of the year had risen about 70% year on year to 66.6 billion roubles ($836 million).

The company's net loss for the first nine months was 12.9 billion roubles, broadly unchanged from 13 billion roubles a year earlier.

"Despite reporting losses since 2018, we have demonstrated improving profitability," Ozon said in the prospectus.

Ozon named Morgan Stanley and Goldman Sachs as joint lead book-running managers for the IPO, with Citigroup Global Markets, UBS Securities, Sberbank CIB and VTB Capital as joint bookrunners.

Renaissance Securities, a legal entity of Russian investment bank Renaissance Capital, will act as co-lead manager.

(Reporting by Olga Popova, Maria Kiselyova and Alexander Marrow; Writing by Alexander Marrow; Editing by Louise Heavens and David Goodman)

[© 2020 Thomson Reuters. All rights reserved.]

Copyright 2020 Reuters. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.  Thompson Reuters is solely responsible for this content.