Russia's Melon Fashion Group picks banks for IPO - sources (updated)
21/12/2021 11:30
(Adds detail, background, CEO quotes)
By Alexander Marrow and Olga Popova
MOSCOW, Dec 21 (Reuters) - Russia's Melon Fashion Group has
picked Sberbank CIB, VTB Capital, Goldman Sachs and BofA to help
organise its initial public offering (IPO), two sources with
knowledge of the company's plans told Reuters on Tuesday.
Several Russian companies could hold IPOs in 2022, extending
the listing spree that started a year ago, if geopolitics,
including Ukraine tensions, and other risks do not thwart their
plans. urn:newsml:reuters.com:*:nL8N2SY3Z9 urn:newsml:reuters.com:*:nL8N2SZ0LM
One financial market source said Melon was aiming to list in
autumn 2022.
Melon Fashion, VTB Capital and Goldman Sachs declined to
comment. Sberbank CIB and BofA did not immediately respond.
Based in St Petersburg on a site that housed a sewing
factory in Soviet times, Melon owns four, mainly women's,
fashion brands - Zarina, Befree, Love Republic and Sela - with
around 815 stores across Russia.
The Kommersant daily reported in September, citing sources,
that Melon was considering the Moscow Exchange for its listing.
"It's too early to talk about an IPO at the moment," CEO
Mikhail Urzhumtsev told Reuters in an interview earlier this
month.
"An IPO is one of a variety of opportunities for the
company's development that we are considering," he said, without
providing further details.
Melon reported a 66% year-on-year increase in revenue for
the first nine months of 2021 to 28.3 billion roubles ($383.5
million), already surpassing the figure for the whole of 2020.
Its online business jumped from 7% of sales in 2017 to 34% in
2020, Urzhumtsev said.
"We are starting online penetration outside Russia and CIS
countries and we believe this is our way out, mostly online," he
said, explaining the company planned to use e-commerce
marketplaces for this.
Swedish real estate firm Eastnine, which holds a 36% stake,
said in its nine-month report that Melon's strong growth had
opened up divestment opportunities. This may take the form of an
IPO and could occur before summer 2022, Eastnine said.
Melon's creativity hub is based in St Petersburg, where
styles and stores are designed. Production, though fully
controlled from the head office is largely based elsewhere, with
the majority in China.
Urzhumtsev said sustainability had long been important to
the company, but that it was focused on carrying out a deep
diagnosis of its supply chain and factories next year.
($1 = 73.8010 roubles)
(Reporting by Alexander Marrow and Olga Popova
Editing by Mark Trevelyan and Mark Potter)
((alexander.marrow@thomsonreuters.com;))