Quantcast

Evraz shares soar after London listing

0

Shares in steel maker Evraz have soared since it began trading on the London market on Monday, potentially paving the way for a number of Russian companies to seek UK listing.

Evraz’s shares increased by around 40p since the beginning of the week to reach 360p on Tuesday afternoon, giving Russia’s biggest steel producer a value of approximately £4.7bn. Evraz is part-owned by Roman Abramovich, who is best known as the billionaire owner of Chelsea Football Club.

Alexander Frolov, the chief executive of Evraz, said: “This result underlines the confidence of the capital markets in our strategy and means that our re-domiciliation in the UK and admission to the premium segment on the Official List of the UK Listing Authority (UKLA) can proceed, paving the way for FTSE UK Index series eligibility.”

Evraz may enter the blue-chip index at December’s reshuffle, meaning that pension managers and tracker funds will need to purchase the company’s shares even though it only had a free float of 23.4 per cent. A free float of 25 per cent is normally needed for a premium listing in London, but UKLA gave Evraz a waiver.

However, a FTSE spokesman said Evraz may need to raise the size of its float later on. The spokesman said: “If Evraz gets included… and the rules subsequently change to a minimum 25 per cent free float then it would need to increase its float at a later date if it wanted to continue index membership but would be given between a 12 and 24-month grace period to achieve that.”

A review of the requirements to gain premium UK listing has begun after questions were raised over corporate governance being granted the status and criticisms of businesses with small free floats.

Evraz could be the first in a wave of Russian companies looking to list in London, where it is easier to raise both a company’s profile and money.

Precious metals miner Polymetal changed its domicile to London and the Russian company started trading in the capital last week. Polyus Gold has also revealed plans for a listing in London, although the process has been slowed after a committee chaired by Russian prime minister Vladimir Putin delayed approving the move.




Share.