Lenta in IPO

March 5, 2014

Cleary Gottlieb represented Lenta in its $952 million initial public offering of GDRs dually-listed in London and Moscow, which was an all-secondary offering by ten shareholders comprising 22% of Lenta’s share capital (prior to any exercise of the greenshoe option) conducted under Regulation S / Rule 144A. The principal selling shareholders were TPG, the European Bank for Reconstruction and Development, and the VTB Capital group. The IPO price sets Lenta’s market capitalization at $4.3 billion and implies an enterprise value of $5.4 billion. The transaction launched on February 3, 2014, priced on February 28, 2014 and closed on March 5, 2014. The GDRs were admitted to trading on both the London Stock Exchange and the MICEX Stock Exchange on March 5, 2014. Lenta became only the third foreign company to take advantage of recently introduced amendments to Russian securities laws that allow foreign securities listed on a foreign stock exchange to be traded on a Russian stock exchange.

Lenta, which was founded in St. Petersburg in 1993, is one of the largest retail chains in Russia and the country’s second largest hypermarket chain (in terms of 2013 sales, which were approximately $4.4 billion). Lenta operates 77 hypermarkets in 45 cities across Russia and 10 supermarkets in Moscow, with total retail trading space of approximately 508,000 sq.m., as well as five distribution centers. Cleary Gottlieb previously represented the TPG-VTB consortium in its original 2009 acquisition of Lenta shares, in a subsequent shareholder conflict, and in the buy-out (including an LBO) of the opposing shareholder group in 2011. The TPG investment in Lenta represents the largest private equity investment made into Russia to date and the IPO its partial monetization. Cleary Gottlieb has also represented Lenta on a number of financings and other matters.