Georgia’s TBC Bank plans $600 mln London share listing-Reuters

(Reuters) – Georgia’s TBC Bank plans to list in London by the end of June, in a sale that will test investor demand for assets from that region given the troubles in nearby Ukraine.

The bank’s debut on the London Stock Exchange could value the group at more than $600 million, a source familiar with the matter said.

Some companies in eastern Europe have held off or delayed listings since the Ukraine crisis began, including German supermarket Metro’s Russian unit, which has postponed a 1 billion-euro market debut.

TBC, the leading bank in Georgia in terms of retail deposits with a 33 percent market share, said on Monday it would sell $100 million in new shares, plus some existing shares which the source said would total around $200 million. The bank is expected to have a free float of around 50 percent of issued capital, the source said.

The bank’s co-founder Badri Japaridze and chief executive Vakhtang Butskhrikidze said the sale had seen sizeable interest, largely from European investors, and that it did not expect the Ukraine situation to have an impact.

“Investors are clearly separating the Georgian banking industry from the problems in Ukraine,” co-founder Badri Japaridze said.

“Of course it is unfortunate what is happening in Ukraine, but it has no impact in the Georgian economy because it has diversified significantly in the past 10 years.”

Russia shares a border with Georgia and accounts for 6 percent of the country’s total exports.

TBC’s rival Bank of Georgia, already listed on the London Stock Exchange, has shrugged off the Ukraine crisis. Its shares are up 7.9 percent in the year so far, against a slight fall in the index as a whole.

But earlier this month, the Asian Development Bank warned that the fallout from Ukraine could harm economic growth in the Caucasus nations, which include Georgia, Armenia and Azerbaijan.

The bank said it expected the region to post economic growth of 6.5 percent, unchanged from its forecast last year.

TBC said that the stock market listing would fuel lending to both retail customers and small and medium-sized enterprises (SMEs). Founded in 1992, the privately-owned bank has around 1 million retail, small business and corporate customers.

The bank said it would have a book value of $520 million after the listing. It currently has a tier one capital ratio of 21.4 percent. The minimum ratio required by Britain’s financial regulator is 7 percent.

TBC has appointed Barclays and UBS as joint global coordinators and joint bookrunners for the flotation. Renaissance Capital is also a bookrunner, while Peel Hunt will act as co-manager.

 

 

 

 

 

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